The conversation between human and AI assistant.
Example of perfectly inelastic demand?
That makes sense. Can you explain the difference between elasticity of demand and inelasticity of demand?
Elasticity of demand refers to how much consumers will change their buying habits as a result of a change in price. If a small change in price results in a large change in the quantity demanded, then the product is said to have elastic demand. On the other hand, if a change in price has little or no effect on the quantity demanded, then the product is said to have inelastic demand.