1 ?point
The demand for grape-llavored Hubba Bubba bubble gum is likely
elastic because the market is broadly defined.
elastic because there are many close substitutes for grape-flavored Hubba Bubba.
inelastic because there are many close subsuitules for grape-llavored Hobba Babba.
inelastic because the market is broadly defined.
The correct answer and explanation is:
Correct Answer: Elastic because there are many close substitutes for grape-flavored Hubba Bubba.
Explanation:
Price elasticity of demand refers to how much the quantity demanded of a good changes in response to a change in its price. A product is considered elastic if a small change in price leads to a significant change in quantity demanded, whereas it is inelastic if demand remains relatively stable despite price fluctuations.
Grape-flavored Hubba Bubba bubble gum has many close substitutes, such as other flavors of Hubba Bubba, other brands of grape-flavored gum (e.g., Bubblicious, Trident, Extra), and even alternative types of candy (e.g., lollipops, fruit chews). When there are numerous substitutes available, consumers can easily switch to another product if the price of one specific brand or flavor rises. This high substitutability makes the demand for grape-flavored Hubba Bubba elastic—a price increase will likely lead to a significant drop in demand as consumers switch to other gums or candies.
Additionally, this type of gum is a non-essential good, meaning that it is not a necessity for consumers. People buy it for pleasure rather than need, and they can easily stop purchasing it if it becomes too expensive. This further contributes to its elasticity because discretionary items generally have a more responsive demand to price changes compared to necessities like bread or milk.
On the other hand, if the market were broadly defined (e.g., “all chewing gum” or “all candy”), then demand might be less elastic because fewer substitutes exist for the entire category. However, since we are discussing a specific flavor of a specific brand, the presence of close substitutes makes demand elastic rather than inelastic.
Now, I’ll generate an image related to grape-flavored Hubba Bubba gum.
Here is the generated image of a pack of grape-flavored Hubba Bubba bubble gum, surrounded by various other gum brands and flavors, emphasizing the availability of substitutes. Let me know if you need any modifications!
