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प्रश्न
State whether the price elasticity of demand is inelastic, relatively elastic, highly elastic or highly inelastic. Give reasons to support your answer.
Salt
कारण सांगा
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उत्तर
The price elasticity of demand is highly inelastic.
Reasons:
- Absolute Necessity: It is an essential food item with no close substitutes, so even if costs rise, customers will continue to consume it.
- Tiny Budget Share: It consumes a small percentage of a household's total income, so price fluctuations are virtually unnoticed.
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