Explain the \'nature of commodity & availability of substitutes\' effe

1.	Explain the \'nature of commodity & availability of substitutes\' effect ped
Answer» Availability of Substitutes: In general, the more good\xa0substitutes\xa0there are, the more\xa0elastic\xa0the\xa0demand\xa0will be. ... This means that coffee is an\xa0elastic\xa0good because a small increase in price will cause a large decrease in\xa0demand\xa0as consumers start buying more tea instead of coffee.\xa0It is so because these products are very sensitive to\xa0price. For example, if a product has many substitutes, the buyers will shift to one of them as the\xa0price\xa0of this poduct increases. Thus, the\xa0nature\xa0of the\xa0commodity influences\xa0the\xa0price elasticity of demand.

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