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What is the difference between inelastic demand and perfectly inelastic demand?
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What is the difference between inelastic demand and perfectly inelasti...
perfectly inelastic means when a change in price causes a smaller change in demand.
EXAMPLE if the price of a commodity increase 40 % and the demand decrease only 10% .
there are so many factors that make demand inelastic .
NO substitute .If you have a car, there is no alternative but to buy petrol to fill up the car. If you rely on the train to get to work, the train firm can increase prices with little fall in demand
LITTLE COMPETITION . If a firm has monopoly power then it is able to charge higher prices. For example, prices on motorway service stations tend to be higher, because consumers can’t choose where to buy food, without leaving the motorway.
A SMALL PERCENTAGE OF INCOME . If you a good like salt is a small percentage of income, you may be less concerned about price.
BOUGHT INFREQUENTLY .If you buy a good infrequently, such as salt, you are less likely to be sensitive to price.
SHORT RUN .In the short-run, demand tends to be more price inelastic. It takes time for consumers to look for alternatives
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What is the difference between inelastic demand and perfectly inelastic demand?
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What is the difference between inelastic demand and perfectly inelastic demand? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What is the difference between inelastic demand and perfectly inelastic demand? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the difference between inelastic demand and perfectly inelastic demand?.
What is the difference between inelastic demand and perfectly inelastic demand? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What is the difference between inelastic demand and perfectly inelastic demand? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the difference between inelastic demand and perfectly inelastic demand?.
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