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Elasticity - Coggle Diagram
Elasticity
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Degree of elasticity
Products that are necessities are more unsensitive to changes in price because consumers would continue buying these products despite the increase in price.
Elastic demand
When the proportionate change in quantity demanded of a good is greater than the proportionate change in the price of the good itself.
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Unitary elastic demand
When the proportionate change in the quantity demanded of a good is equal to the proportionate change in the price of that good.
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Inelastic demand
When the proportionate change in quantity demanded of a good is less than the proportionate change in price of that good.