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The state of the economy has a significant effect on demand for which type of commodities?

User Petran
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Answer:

Non-essential commodities

Step-by-step explanation:

When the economy is in bad shape, people will usually restrict their expenses to only the essential items they really need: food, clothes, housing, transportation. Even within those categories, they'll make more economical choices (for example ground beef instead of a t-bone steak).

When the economic situation is better, they will improve their selection and choices in the 4 categories mentioned, and will also spend on luxury and non-essential commodities, like entertainment (movies), a second car, jewels, and so on.

User Marc Schulder
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