price elasticity (PED) Flashcards
1
Q
What 5 factors affect PED?
A
- Fashionable
- Ethical
- Durable
- Customer service
- Competition
2
Q
What is the equation for PED?
A
% change in demand / % change in price
3
Q
What is the equation for percentage change?
A
(difference / original value) x 100
4
Q
Due to _____________ a business’ products may become __________, leading to customers being _________ to the brand.
A
- poor customer service
- price elastic
- less loyal
5
Q
Therefore, if prices increase there will be a ______________ in demand, leading to _____________ to keep prices ___.
A
- significant drop
- pressure
- low
6
Q
2 examples of a price inelastic product..
A
- Fuel/Petrol
- Milk
7
Q
Through _____, a business can _____________ their products from ________ such as…
A
- R+D
- differentiate
- rivals
8
Q
Therefore, customers are likely to ____________ as they know they can’t get the same products from ___________. This makes them more ______________ so they can __________________ without demand falling significantly.
A
- stay loyal
- competitors
- price inelastic
- charge higher prices
