Goods that are essential in daily life have lower elasticity needs like gas, water, oil and electricity.
Elastic demands are the requirements when the large price shift affects the demand of the product. While in inelastic the price change affects in a very small manner to the demand.
The correct answer is:
Option B: Inelastic when the price changes.
This can be explained as:
- In an economy, when the goods and commodities are in static relation then it is called inelastic.
- The increase in the price of the product does not affect the customers purchasing habits in an inelastic system.
Therefore, goods that are considered to be requirements tend to be inelastic when the cost varies.
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