170k views
2 votes
The market for a product is generally viewed as __________when its price elasticity is greater than −1.

User Ryan Siu
by
7.2k points

1 Answer

2 votes

Answer:

Price insensitive

Step-by-step explanation:

When the price elasticity is greater than -1 it means that a 1 percent change in price will cause a less than 1% change in quantity demanded of the product, this means that the product is inelastic and it's market is price insensitive. For example if a computer has a price elasticity of -0.5 (a number which is greater than -1) it means that a 1 percent change in the price of the computer will cause a 0.5% change in the quantity bought of the computer, which means it is relatively price insensitive

User LuckyLuke
by
7.9k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories