Unit 3 Discussion - DISCUSSION QUESTION Assume that you...

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DISCUSSION QUESTION:Assume that you recently made a purchase onAmazon.com. The next time you go to purchase this item, let’s say you find out that the price has increased by X dollars. How would you respond to this price increase? Would you say this item is Relatively Elastic, Relatively Inelastic, or Unitary Elastic? Explain using the Determinants ofthe Price Elasticity of Demand (see page 83).Think about how the increasing popularity of shopping online impacts your response. This is an interesting topic. I may have a couple examples I can contribute towards this discussion. Over recent years, my wife and children have turned me on to online shopping. From my wife’s perspective, Amazon Prime is the tool of choice, however, if I am shopping for sports equipment, I typically will go to the specific vendor that makes the product (Easton Sportsfor example). In my first example, I typically use Amazon Prime to help order these K-Cups for my wife. She is the coffee drinker in the house so as long as she is happy, we are all happy. For me, I really am not too concerned with price with her coffee. I will buy her the name brand coffee such as Starbucks or Dunkin Donuts all day long as long as she will be a happy camper. She, on the other hand, prefers to watch the pennies and go for the off brand coffee. Since I have to order her coffee every three months, I tend to see the price fluctuate quite often. Regardless, I will stillpurchase the named brand coffee. WHY? Because it is her one thing that she really likes (I married a Cuban) and I will not deprive her in any way of having a decent cup of coffee to drink.

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