Question

List the five keys determinant of price elasticity of demand and explain how 

each determinant indicates whether demand tends to be elastic or inelastic

Answer 1

The 5 aspects affecting price elasticity of demand include price level and substitutes availability. Similarly, when a good tends to be a necessity or a luxury usually determine the price elasticity of demand. Proportion of the income that has been spent on a good, and the period that has elapsed considering the time when price was changed.