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Elasticity of Demand
Elasticity of demand

The concept of elasticity of demand has been provided by economic theorists. Elasticity is the degree to which demand is affected by another variable, in most cases price. It is a measure of the change in demand that occurs as prices rise or fall (or of course as whichever other variable is significant rises or falls).

A product is said to have a price inelastic demand curve if a change in price has little effect on demand. The example most often quoted is that of salt: salt is so infrequently purchased, and is so cheap, that most people would ...

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