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Search results with tag "Substitution effects"
Elasticities of Chapter demand. and Supply Demand 5
www.unf.edu• Substitution effects • Income effects Substitution Effects The demand for a good is elastic if a substitute for it is easy to find. The demand for a good is inelastic if a substitute for it is hard to find. 5.1 THE PRICE ELASTICITY OF DEMAND Three main factors influence the ability to find a substitute for a good: Luxury Versus Necessity