The correct answer is A.
Elasticity of demand is a measure of how responsive consumers are to changes in the price of a good or service. It is calculated by dividing the percentage change in the quantity demanded by the percentage change in the price.
A high elasticity of demand means that consumers are very responsive to changes in price, and a low elasticity of demand means that consumers are not very responsive to changes in price.
There are a number of factors that can affect the elasticity of demand for a good or service, including the availability of substitutes, the importance of the good or service to consumers, and the time horizon.
In general, goods with many substitutes tend to have a high elasticity of demand, while goods with few substitutes tend to have a low elasticity of demand. This is because if the price of a good with many substitutes goes up, consumers can easily switch to another good.
Goods that are important to consumers also tend to have a high elasticity of demand. This is because consumers are less likely to give up on a good that is important to them, even if the price goes up.
Finally, the time horizon can also affect the elasticity of demand. In the short run, consumers may be less responsive to changes in price, as they may not have time to adjust their spending habits. However, in the long run, consumers are more likely to adjust their spending habits, and the elasticity of demand will be higher.
The other options are incorrect because they do not measure the responsiveness of demand to changes in price. Option B measures the responsiveness of demand to changes in supply. Option C measures the change in price due to a change in demand. Option D measures the change in demand due to a change in tastes of consumers.