For each of the following pairs of goods, which good would you expect to have more elastic demand and explain clearly why? (8 marks) a. Coca-Cola or water
b. Required textbooks or fiction novels
c. Ice-cream or chocolate ice-cream’
d. Train ride during the next 6 months or train rides during the next 5 years

A. Coca- cola would have a more elastic demand due to the fact that water is an essential commodity and an individual have to consume water no matter what the price of it is.

B. Fictional novels are luxury goods and their demand could be avoided by someone as compared to the textbooks in case of any deficiency of money. Thus, novels would have more elastic demand.

C. The elasticity of ice cream would be more elastic as if a costumer is willing to eat chocolate flavor he or she would not bother about slight changes in price.

D. Elasticity for five years would be high as the consumer will have more options during such time period.

answer; (a) searching for information can be done quickly;

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