Price elasticity on demand

Price Elasticity on Demand shows

• how demand changes if the price changes

• how price changes if demand changes

• how prices change

Demand is

• how much people pay for a product

• when customers want to pay this price for a product

• when customers try to get discounts

Substitutes are products that satisfy

• different needs and wants

• same needs and wants

Select substitutes

• Gucchi bag and Carrefour bag

• Pepsi and Cocal Cola

• Ferrari and Nissan

If the price INCREASES, the demand_______.

• increases

• remains the same

• decreases

If demand is ELASTIC,

• it reacts a lot to price changes

• it doesn't react to price changes

• price change leads to an equal change in demand

Select a product with ELASTIC demand

• petrol

• make up

• electricity bill

Unitary Elastic Demand

• demand reacts a lot to price changes

• change in price leads to an equal change in demand

• demand doesn't react to price changes

Select a Unitary Elastic product

• bread

• electricity bill

• make up

INELASTIC demand

• demand reacts a lot to price changes

• change in price leads to equal change in demand

• demand doesn't react a lot to price changes