A community for students.
Here's the question you clicked on:
 0 viewing
Dodo1
 2 years ago
whats inelastic and elastic? also once you calculated price elasticity of demand how do you know elastic or in?
Dodo1
 2 years ago
whats inelastic and elastic? also once you calculated price elasticity of demand how do you know elastic or in?

This Question is Closed

order
 2 years ago
Best ResponseYou've already chosen the best response.0Demand can be elastic or inelastic in economic theory. Elasticity of demand is the measure of responsiveness of the level of demand in response to a change in prices. This means that, for example, if prices increase, let's say, by only a small amount (e.g. 50p) and the demand, or willingness to buy that item (let's say it's chocolate) drops by a greater or much greater amount than the price changed (e.g. from 1000 people to 300 people), then the demand for that item is said to be PRICE ELASTIC. However, if price increases by a large amount (e.g. by £30) for petrol, and the demand only decreases by a little amount, or an amount less than that in the change of price for petrol (let's say 1000 people to 900 people), then the demand for that item is said to be PRICE INELASTIC. Calculation of elasticity: \[percentage~change~of~quantity~demanded \over precentage~change~of~price\] If demand is ineslatic, outcome = < () 1 (less than (negative) one) unitary price elastic, outcome = () 1 ((negative) one) elastic, outcome = > () 1 (greater than (negative) one) Note: Elasticity for demand in results is negative because of the inverse relationship between demand and price (as price goes up, demand falls); however, the negative sign is not shown/used or is stated in brackets when calculating the elasticity of demand. Hope this helps! If you have questions, please ask. I've been studying these principles for a while now...
Ask your own question
Sign UpFind more explanations on OpenStudy
Your question is ready. Sign up for free to start getting answers.
spraguer
(Moderator)
5
→ View Detailed Profile
is replying to Can someone tell me what button the professor is hitting...
23
 Teamwork 19 Teammate
 Problem Solving 19 Hero
 Engagement 19 Mad Hatter
 You have blocked this person.
 ✔ You're a fan Checking fan status...
Thanks for being so helpful in mathematics. If you are getting quality help, make sure you spread the word about OpenStudy.