Question :
(a) Explain why each of the following factors may influence the own price elasticity of demand for a commodity.
(i) Consumer preferences, that is, whether consumers regard the commodity as a ‘luxury' or a ‘necessity'.
(ii) The narrowness of definition of the commodity.
(iii) The length of the period under consideration
(iv) The availability of substitutes for the commodity
(b) The coffee market is subject to volatility caused by weather conditions in key supplying countries such as Brazil. What other factors are likely to influence this market?