3 Ep > 1 Y- axis Elastic or Relatively Price P1 AD X- axis D D1 Quantity demanded The demand is said to be relatively elastic if the percentage change in demand is greater than the Percentage change in price. It is also called highly elastic demand or simply elastic demand. For example: If the price falls by 5% and the demand rises by more than 5% (say 10%), then demand for luxurious goods such as car, television, furniture, etc. is considered to be elastic.
Ep< 1 4 Y axis Price P1 X- axis D D1 Quantity demanded The demand is said to be relatively inelastic if the percentage change in quantity demanded is less than The percentage change in price. It is also called less elastic or simply inelastic demand. For example: when the price falls by 10% and the demand rises by less than 10%, then it is the case of inelastic demand. The demand for goods of daily consumption such as rice, salt, kerosene, etc. is said to be inelastic.
Y-axis 5 (Perfectly Inelastic Demand) E0-0) Price axis Demand In the given figure, the demand curve DD is a vertical straight line parallel to the OY-axis The demand is said to be perfectly inelastic if the demand remains constant even in the price rises or falls. It is called zero elasticity
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