Question

In your own words, describe your experience with price elasticity as a consumer. Provide an example of an inelastic good and an elastic good for your household. What makes those goods elastic or inelastic? How might other households respond differently?

Please answer in 150 words or more.

Answer 1

Solution

The price elasticity demand measures the responsiveness of the demand for changes in the price when other influencing factors remained constant the following the types of the Price elasticity of the demand.

elasticity demand refers to smaller changes in the price results in greater changes in demand in daily usage of luxurious goods is example Smarts Phones if the brand smartphone price falls demand increases more.
Inelasticity of the demand fall in price does not increase or decrease the price of the goods.Example necessary goods used in daily usage Salt if the price falls demand does not change quickly.
The availability of the substitute, necessity or luxurious nature of the goods determines the elasticity demand in the market and daily usage in consumers.