Will products that are important to us and that have no close substitutes have elastic or inelastic demand?
Is the answer inelastic??
Right.
http://www.businessdictionary.com/definition/elasticity-of-demand.html
Are you maria butt in grade 3rd.
The elasticity of demand for a product is determined by the availability of substitutes. If a product has no close substitutes or alternatives, the demand for that product is generally considered to be inelastic.
To understand elasticity of demand, we can calculate it using the formula:
Elasticity of Demand = (% change in quantity demanded) / (% change in price)
In the case of a product with no close substitutes, even if there is a change in the price of the product, consumers have limited options to switch to an alternative. Thus, the change in price will have a relatively smaller impact on the quantity demanded. As a result, the percentage change in quantity demanded will be less significant compared to the percentage change in price, resulting in a value less than 1 for the elasticity of demand.
Therefore, the demand for products that are important to us and have no close substitutes is typically inelastic.