Explain whether the supplies of the following goods are elastic or inelastic? And why?

-Hotel Rooms

-Taxi Rides

-Photographs

Give examples of a fixed cost and variable cost of a Bakery.

How does a firm or business calculate marginal cost?

Verified Answer :

Elastic means that if the price goes up or down, it will greatly affect the demand of the product

Hotel rooms & Taxi rides = Elastic

Photograph = Tend to be inelastic because artistic value is often rarely affecting demand

Example of Variable cost of bakery = cost of Flour

Hope this helps