top button
Flag Notify
    Connect to us
      Site Registration

Site Registration

What are the uses of price elasticity of demand to the business firms and to the government?

+1 vote
235 views
What are the uses of price elasticity of demand to the business firms and to the government?
posted Jul 12, 2017 by Mukul Chag

Share this question
Facebook Share Button Twitter Share Button LinkedIn Share Button

1 Answer

0 votes

Elasticity of demand is the sensitivity of quantity demanded of a commodity in response to the change in factors related to that commodity. Elasticity of demand may be of different types, depending upon the factor that is responsible for causing the change in demand. Among them, price elasticity of demand is one of the most common types and is also the most relevant to business.

Price elasticity of demand can be a useful tool for businessmen to make crucial decisions like deciding the price of goods and services. It plays vital role in other business procedures too. These uses are described below in brief.

answer Jul 13, 2017 by Ramesh Gowda
...