Labor Market Question (Microeconomics) - Check Work?

Question

The year is 2047. In many occupations, robots are replacing humans. As it turns out, robots make very good housekeepers, but very bad chauffeurs. Assuming the other determinants of demand for the two services are roughly similar, we would expect that the demand for human housekeepers is ________ the demand for human chauffeurs.

A. Derived from

B. As elastic as

C. More elastic than

D. Less elastic than

My Thoughts: would this be D?

Also, why wouldn't the answer be A (if it isn't)

Answer 1

C. More elastic than

You are right if demand curve is NOT downward-sloping  linear (and some other general cases), robots are replacing humans and cheaper, so it means supply of robots is higher than supply of humans.

As you move over linear downward-sloping demand curve upward (as equilibrium on this market do due to differences in supply) - demand becomes more elastic (for the same demand curves) - so elasticity of demand increases (E→∞). And vice versa, as you move downward by downward-sloping linear demand curve elasticity falls (E→0).

There could be many different demand curves.

"A" may be false because housekeeping is not necessarily substitute for chauffeurs.

"B" is true only for constant elasticity demand curves.

"D" might be true too for some demand curves or at specific ranges of demand.