Question

which of the following items have elastic demand? (remember: items that are \wants\ and/or have many substitutes tend to be elastic. items that are
eeds\ and/or have few substitutes tend to be inelastic.) select all that apply.

chicken
insulin
salt
gasoline
jeans
apple juice

Explanation:

Analyze the definition of elastic demand

Using the Price Elasticity of Demand knowledge point

• Elastic demand means quantity demanded is highly sensitive to price changes.
• Items with many substitutes or those considered "wants" (luxuries) have elastic demand.
• Items with few substitutes or those considered "needs" (necessities) have inelastic demand.

Evaluate each item based on substitutes and necessity

Using the Price Elasticity of Demand knowledge point

• chicken: Many close substitutes exist (beef, pork, tofu, fish). Thus, demand is elastic.
• insulin: A life-saving medical necessity with no close substitutes. Thus, demand is highly inelastic.
• salt: A cheap necessity with no close substitutes, representing a tiny fraction of income. Thus, demand is inelastic.
• gasoline: A necessity for transportation with few immediate substitutes for most drivers. Thus, demand is inelastic.
• jeans: Many clothing alternatives and brands exist. Thus, demand is elastic.
• apple juice: Many other beverage substitutes exist (orange juice, water, soda). Thus, demand is elastic.

Answer:

• chicken (Correct answer)
• insulin
• salt
• gasoline
• jeans (Correct answer)
• apple juice (Correct answer)