Question

Price Elasticity of Demand. Discuss the price elasticity of demand. Is it directly related to the availability of suitable substitutes for a product? Please integrate the Bible passages in your discussion.

Answer 1

Price Elasticity of Demand :

A. It is the measure of responsiveness of proportionate change in quantity demanded due to proportionate change in price.
Price Elasticity of Demand = Percentage
change in quantity demanded /Percentage change in price.

Types of price elasticity of demand are as follows :-
1.Unitary Elastic Demand.
2.Perfectly Elastic Demand.
3.Relatively Elastic Demand.
4.Relatively Inelastic Demand.
5.Perfectly Inelastic Demand.

B. Relationship between availability of substitute goods. If direct substitutes are available to goods, being more price sensitive, with rise in price of product demand for substitutes will increase in such a case of direct substitute demand for product is elastic. If no direct substitutes are available any price change can't effect the demand for product. In this case demand become inelastic.

C. Bible passages related to elasticity.
God will provide abundant supply of resources , commodities and blessings for people when they are loyal to his commands.God will not bless to people when they aren't loyal to him and creates scarcity of all things.