Q.State, with reasons, whether the price elasticity of demand is likely to be relatively elastic or relatively inelastic for each of the following:

Weigh each commodity against the standard elasticity-determining factors — availability of substitutes and whether it is a necessity.

(i) Table salt has virtually no close substitute and is a necessity used in tiny quantity — demand is relatively inelastic. …

1. Table salt. Table salt has essentially NO close substitute for its culinary use, is a NECESSITY consumed by every household regardless of price, and takes up a NEGLIGIBLE proportion of a household's total income even if its price were to double. All three of these — absence of substitutes, necessity status, and negligible budget share — are the standard factors that push a commodity toward INELASTIC demand. So the demand for table salt is relatively inelastic: even a fairly large percentage change in its price produces only a small percentage change in the quantity households buy.
2. A branded soft drink with many close competing brands. Here the decisive factor is the AVAILABILITY OF CLOSE SUBSTITUTES — with several competing brands offering a very similar product, a price rise in one brand gives consumers an easy, low-cost way to switch to a rival brand instead of continuing to buy at the higher price. A soft drink is also a COMFORT/mildly discretionary purchase rather than a strict necessity, whose consumption can be cut back or postponed. Both factors push this commodity toward ELASTIC demand. So demand for this branded soft drink is relatively elastic: a price rise causes a MORE than proportionat …