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Fill in the blank, elastic or inelastic

1. In the summer, the price elasticity of demand for cold
beverages is more _________ than the price elasticity of demand for
cold beverages in the winter. Why?

1 Answer

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Final answer:

In the summer, the price elasticity of demand for cold beverages is more elastic than in the winter due to the higher demand and willingness to pay a higher price, while in the winter, there is generally a lower demand for cold beverages.

Step-by-step explanation:

In the summer, the price elasticity of demand for cold beverages is more elastic than the price elasticity of demand for cold beverages in the winter.

This is because in the summer, people have a higher demand for cold beverages due to the hot weather, and they are willing to pay a higher price for them. As a result, a small increase in the price of cold beverages in the summer will lead to a larger decrease in the quantity demanded, making it more elastic.

In contrast, in the winter, there is generally a lower demand for cold beverages because people prefer hot drinks such as coffee or tea. Therefore, the price elasticity of demand for cold beverages in the winter is lower, making it more inelastic.

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