What types of goods have a lot of price elasticity?
There are several types of goods that have a lot of price elasticity. Some examples include:
1. Luxury goods: Luxury goods like high-end cars, designer clothes, and upscale jewelry typically have high price elasticity. This is because they are not necessities and consumers are more sensitive to price changes for such items.
2. Non-essential items: Non-essential items such as electronics, entertainment products (movies, video games), and recreational goods usually have a high price elasticity as consumers can easily find substitutes or delay or forgo purchasing these goods if the price increases.
3. Generic or commodity products: Generic or commodity products like unbranded groceries, basic household items, and staple foods tend to have high price elasticity. Consumers are more likely to switch brands or search for alternatives if the price of these goods increases.
4. Highly competitive markets: Goods in highly competitive markets, such as fast food, airline tickets, and gasoline, often exhibit high price elasticity. Consumers have multiple options and can easily switch between competitors based on price changes.
5. Perishable goods: Perishable goods like fresh produce, flowers, and seafood usually have high price elasticity due to their limited shelf life. Consumers are more likely to alter their purchasing decision based on price fluctuations because they cannot store or consume these goods for an extended period.
It is important to note that the price elasticity of goods can vary across different market conditions and consumer demographics.