Surname 2. Name:. Tutor:. Course:. Date:. Luxury have m

In general, the more that good is considered to be a luxury rather than a necessity, the greater is the price elasticity of demand. Do you agree or disagree with this statement? Explain. you should be answered this question in 110 words.

Surname 1
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Tutor:
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Luxury have more price elasticity of demand than necessity.
Generally, the more that good is regarded to be a luxury instead of a necessity, the more is the
price elasticity of demand. I agree with this statement because the price elasticity of demand
measures the responsiveness of the quantity demanded for good or service to a unit variation in
their respective price when only price varies considering consumer’s budget (Thorbecke, Willem
and Kato). Luxury products have an income elasticity of demand which is greater than one. The
average rise in demand is more than the price rise in buyer’s level of earning (Rolling, Virginia
and Sadachar). For instance, if we take jewellery and medicine, during the periods of decline in
consumer consumers level the individuals will do without the jewellery but they cannot so
without medicine.

Surname 2
Works Cited
Rolling, Virginia and Amrut Sadachar. "Are sustainable luxury goods a paradox for
millennials?" Social Responsibility Journal 14.4 (2018): 802-815.
Thorbecke, Willem and Atsuyuki Kato. "Exchange rates and the Swiss economy." Journal of
Policy Modeling 40.6 (2018): 1182-1199.