The price of cranberry juice suddenly increases. As a result, Glenda begins drinking more grape juice, which is less expensive, but tastes just as good to her. In this case, Glenda’s elastic demand is due to
A. availability of substitutes.
B. relative importance.
C. necessities versus luxuries.
D. change over time.
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I believe it to be a) however i could be wrong
The correct answer is A. availability of substitutes.
Elasticity of demand refers to how responsive the quantity demanded of a good or service is to a change in its price. When a consumer has an elastic demand, it means that they are more likely to change their purchasing behavior when the price of a product changes.
In this scenario, Glenda's response to the increase in price of cranberry juice is to drink more grape juice instead. This indicates that grape juice is a substitute for cranberry juice in Glenda's consumption choices. Since grape juice is less expensive and tastes just as good to her, Glenda is able to easily switch to the cheaper alternative when the price of cranberry juice increases.
Therefore, Glenda's elastic demand is due to the availability of substitutes.