Pick two products and explain which one will have a greater price elasticity of demand and why this will be the case.
Let us look at the price elasticity of demand for vacations in general and for vacations in Hawaii in particular. If the price of both go up by the same percentage, it is likely that the quantity demanded of vacations to Hawaii will go down more than for vacations in general. In other words, the vacations in Hawaii have a greater price elasticity of demand.
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