1.2.4 Price Elasticity of Demand (1/2)

Question 1

Price Elasticity of demand

Answer 1

The relationship that exists between the responsiveness of demand and a change in price

Question 2

Price elastic demand

Answer 2

A change in price causes a big change of demand

Either increased or decrease

Question 3

Demand for ELASTIC products are SENSITIVE in relation to price changes T/F?

Answer 3

True

Question 4

Price inelastic

Answer 4

A change in price results in a relatively small change of demand.

Question 5

Demand for INELASTIC products are SENSITIVE in relation to price changes T/F?

Answer 5

False

Question 6

How do you determine whether a product is price elastic or inelastic?

Answer 6

Look at the numerical values

Question 7

Numerical value for price elastic

Answer 7

Any number greater than 1

More than 1 = Prince elastic

Question 8

Numerical value for prince inelastic

Answer 8

Any number less than 1

Less than 1 = Price inelastic