Analyse the reasons why the price elasticity of demand for one brand of luxury chocolates islikely to be different from that of salt.

The price elasticity of demand measures how responsive the quantity demanded of a good is to a change in its price. It is determined by a variety of factors, including the availability of substitutes, the proportion of income spent on the good, and the degree of necessity of the good.

1. Availability of Substitutes: Luxury chocolates have many substitutes in the market, including other brands of luxury chocolates, regular chocolates, and other types of sweets. If the price of one brand of luxury chocolates increases, consumers can easily switch to another brand or type of chocolate. This makes the demand for luxury chocolates highly elastic. On the other hand, there are few substitutes for salt. If the price of salt increases, consumers have no choice but to continue buying it, making the demand for salt inelastic.

2. Proportion of Income Spent: Luxury chocolates are expensive and can take up a significant proportion of a consumer's income. Therefore, if the price of luxury chocolates increases, consumers may reduce their consumption significantly, indicating a high price elasticity of demand. In contrast, salt is relatively cheap and takes up a small proportion of a consumer's income. Even if the price of salt doubles, it would not significantly affect a consumer's budget, so the quantity demanded would not change much, indicating a low price elasticity of demand.

3. Degree of Necessity: Luxury chocolates are a luxury good, not a necessity. If the price increases, consumers can easily choose not to buy them, making the demand for luxury chocolates elastic. However, salt is a necessity in most households for cooking. Even if the price increases, consumers will still need to buy it, making the demand for salt inelastic.

In conclusion, the price elasticity of demand for one brand of luxury chocolates is likely to be different from that of salt due to differences in the availability of substitutes, the proportion of income spent on the good, and the degree of necessity of the good.