Sunday, January 22, 2017

Unit 1

January 11
  • Elasticity of Demand- A measure of how people react to a price in demand
  • Elastic Demand- Demand that is very sensitive to a change in price
    • Products is not a necessity
    • Available substitute
    • Examples
      • Sodas
      • Fur Coat
      • Pizza
    • it is always greater than one
  • Inelastic Demand- it is not very sensitive to a change in price 
    • Product is a necessity 
    • few or no substitution
    • Example
      • Gas
      • Salt
      • Insulin
    • it's always less than one 
  • Unitary Elastic- Its is equal to one
Posted by at

1 comment:

  1. Huma S.January 23, 2017 at 5:53 PM

    Elastic Demand is not sensitive to change which means it has a lot of "wiggle-room". This helps me remember the definition because elastic is stretchy and the demand is "stretchable".

    ReplyDelete

Subscribe to: Post Comments (Atom)