Advertisements
Advertisements
Question
How do we determine whether the demand for a particular commodity is elastic or inelastic?
Advertisements
Solution
The commodity is said to be perfectly elastic when:
Perfectly elastic: Demand is said to be completely elastic when a little change in price causes an indefinitely large change in the amount required of a good. A minor increase in the seller's price will reduce the demand for the commodity to zero, whereas a slight decrease in the price will result in such a large increase in demand for products that no single seller will be able to meet the demand at the decreased price. In such cases, the demand curve is a straight line parallel to the X-axis.
APPEARS IN
RELATED QUESTIONS
Which is the implication of a horizontal demand curve?
Which of the following goods have inelastic demand?
Identify elastic demand when value of Ed is ______.
In case of Ed = 0, demand curve is ______.
For the following list of goods state whether the demand is elastic or inelastic. Give reasons:
Matchboxes
Mention the degree of price elasticity of demand for the following goods:
Cosmetics
Indicate the degree of elasticity demand of the following demand curves.
Define perfectly elastic demand.
The value of price elasticity of demand is 0.8. Is demand elastic or inelastic? Give reason.
A list of goods is given below. state whether the price elasticity of demand is inelastic, relatively elastic, highly elastic or highly inelastic. Give reasons to support your answer.
demand for school uniform
