What is elasticity?
Elasticity is about the sensitivity that buyers
and sellers have for changes in price. Elasticity of
demand is defined as the percentage
change in the quantity, relative
to the percentage that the price of
that product has changed. Did you
ever wonder what determines the
degree to which the demand or supply for a product would change when the price
of a product changes? A price increase of one product sometimes leads to a
remarkable decline in the amount that consumers will buy of a certain product,
while an increase in the price of
another product would hardly lead to any reaction
from the consumers at all.
Watch these video's to understand the basics of elasticity.
No comments:
Post a Comment