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what is meant by inelastic demand ? Compare it with perfectly inelastic demand |
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Answer» Inelastic Demand (Ed < 1) : It is also called less than unitary elastic demand. When percentage change in quantity demanded is less than the percentage change in price the demand is said to be inelastic. The demand of goods is called perfectly inelastic. When with the change in the price there is no change in demand for the goods. Thus, when change in price produces no change; in demand then such a demand is called perfectly inelastic demand. In this situation demand curve is a straight line parallel to the Y-axis. |
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