Question

When a 1 percent decrease in price produces more than a 1 percent increase in quantity sold, the product or service is

Answer 1

When a 1 percent decrease in price produces more than a 1 percent increase in quantity sold, the product or service is an Elastic Demand.

What is an Elastic Demand?

• Elastic demand is measured by its percent of change in demand divided by its percent of change in price, provided all other factors remain the same.
• If the change in price and change in demand is proportionate, the item is neither elastic nor inelastic.
• An item has elastic demand if its demand changes more than its price changes.

• For example, if two stores sell identical products of the same amount for different prices, incase of a perfectly elastic demand nobody would buy from the seller with higher priced product.

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Answer 2

When a 1 per cent decrease in price produces more than a 1 per cent increase in quantity sold, the product or service is an Elastic Demand.

What is an Elastic Demand?

• Elastic demand is measured by its per cent of change in demand divided by its per cent of change in price, provided all other factors remain the same.

• If the change in price and change in demand is proportionate, the item is neither elastic nor inelastic.

• An item has elastic demand if its demand changes more than its price changes.

For example, if two stores sell identical products of the same amount for different prices, in case of a perfectly elastic demand nobody would buy from the seller with a higher-priced product.

Learn more about Elastic Demand here:

brainly.com/question/14897348

#SPJ4