Answer 1

In international trade, the concept of elasticity of demand plays an important role. This concept proves helpful in determining the norms that would prove beneficial for international trade. For instance, based on the elasticity of the commodities that are exported, the country can decide on the price that is to be charged. For exports that have inelastic demand, higher price can be charged. Similarly, the concept can be used to formulate export and import policies in a better manner.