1)State true or false and justify your answer: Time is one of the factors that determines the elasticity of demand

Economics Jan 19, 2021

1)State true or false and justify your answer:

Time is one of the factors that determines the elasticity of demand.

State true or false and justify your answer:

If movie prices increase by 30 percent and attendance (quantity of tickets demanded) drops by 40 percent, demand is considered inelastic.

Expert Solution

Here, the statement given in the question is TRUE.

The elasticity of demand measures the responsiveness of the change in the quantity demanded when the price of product changes in different periods of time. Hence, time plays an important role in determining the elasticity of demand.

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