If a good has a very elastic demand, what does that imply?

When a good has a very elastic demand, it indicates that consumers are highly responsive to changes in price. This means that even a small increase in the price of the good will lead to a significant decrease in the quantity demanded, while a small decrease in price will lead to a substantial increase in quantity demanded. Essentially, consumers are willing to adjust their purchasing habits dramatically in response to price fluctuations, seeking substitutes or forgoing the good altogether if it becomes too expensive. This characteristic is often observed in luxury items or goods with many available substitutes, where consumers can easily change their purchasing decisions based on price changes.

In contrast, options suggesting that consumers will not change their buying habits or that demand remains constant regardless of price do not align with the concept of elasticity, as elastic demand fundamentally involves significant changes in behavior related to price changes. The concept of supply being perfectly responsive to price changes does not apply here, as it relates more to the supply side of the market rather than the demand side which is being discussed.