Econ U1 - Elasticities (PED)
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Last updated 9:16 AM on 1/29/26
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9 Terms
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PED
Measures responsiveness of demand to change in price
%change Qd / % change P
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Inelastic demand
When demand change by smaller proportion than price change
-1<PED<0
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Elastic demand
When demand change by larger proportion than price change
PED < -1
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Unitary elastic demand
Change in price = change in demand
PED = -1
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Perfectly Inelastic demand
Change in price does not affect demand
PED= 0
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Perfectly elastic demand
Increase in price → D drops to zero
Decrease in price → D infinitely increases
PED=- inf
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Factors affecting PED
Substitutes
Branding
Percentage of total expenditure
Addiction / habitual
Durability
Time
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Note 
Flashcards (25)