Understanding Inelastic Demand: Why Cancer Medicine is a Necessity

Explanation:

An inelastic demand refers to a product with a demand that is not very responsive to changes in its price. Of the options provided, cancer medicine is likely to have an inelastic demand. This is because cancer medicine is a necessity for individuals who require it for their health, and they are likely to continue purchasing it even if the price increases.

On the other hand, products like rounds of golf, a Rolex watch, and a luxury car are more likely to have elastic demands as they are luxury goods and individuals may be more willing to reduce their consumption or switch to alternative options if the price increases.

Understanding the concept of inelastic demand is crucial for businesses to make strategic pricing decisions. By recognizing products with inelastic demands, companies can adjust their prices more effectively without risking losing customers.

In conclusion, the demand for cancer medicine is likely to remain stable even with price increases, making it an example of a product with inelastic demand due to its necessity for the health and well-being of individuals.