Economics · May / June 2023 · Paper 11 · Question 7
2281Price elasticity of demand (PED)
What is the most likely cause of a product having a price elasticity of demand greater than one?
- AThe product has a close substitute.
- BThe product is a habit-forming good.
- CThe product is a necessity.
- DThe product requires only a small proportion of consumer income.
As printed in the paper
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Correct answer: A. The product has a close substitute.
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