price elasticity Flashcards
1
Q
price elasticity
A
is a measure of the responsiveness of demand to a change in price
2
Q
price elasticity demand
A
the percentage change in quantity demanded is greater than the percentage change in price
3
Q
price inelastic demand
A
the percentage change in quantity demand is less than the percentage change in price
4
Q
summary
A
if the demand for the products of a business is price elastic then its not a good idea to raise prices unless there has been rising costs. If the price is elasticity of the demand is inelastic then business can increase revenue by increasing prices
