Choose one of the following: A. Name a good for which demand is elastic. Why is quantity demanded so sensitive to price? or B. Name a good for which demand is inelastic. Why is quantity demanded not sensitive to price? All sources must be cited using a reference to an article or link to a website

Example of a correct answer:

A good example of a market where most participants earn negative economic profits is Hair stylist. Hair Stylist invest a great deal of time, labor and money to become licensed to style hair in the United States. Generally, fees for schools vary between $6,000-$10000. In North Carolina, licensure requires 1500 at an accredited school of cosmetology and passing the state board test with a minimum grade of 75%. Effectively that is 2 years and thousands of dollars to make on average $23, 600 - $34, 258 annually. (Salary.com, 2022)

A similar investment in a field such as Information technology would net them a positive economic profit.

Implicit cost includes education loans, tools of the trades and products, licensing fees, fees for continuing education, rent, and advertising.

Opportunity cost like going into Information Technology which would have a similar education and monetaryinvestment and proved to be more profitable economically.

Revenue = $34,258

Accounting Cost = $16,800 (Education loans $10,000,Tools and products = $3000Licensing =$200. CE =$50.00 Rent = $3500.Advertising $50)

Implicit Cost - Loss of opportunity cost of entry level salary in Information Technology $56,227

Economic Profit - $34,258 - $16,800 - $56, 227 = $-38,769 Negative Economic Profit.