Please discuss the different elasticities ? how important this is for business ?

Expert Solution

Elasticities is a concept in economics .it refer to responsiveness of one economic variable ,such as quantity demanded to a change in another Variable such as price.

Different type of elasticity -

Price elasticity of demand measure the responsiveness of quantity demanded to change in price.this is point elasticity.it tells about how much price can be decide by the business.

Price elasticity of supply - this measure the responsiveness of quantity supplied to a change in price.this is important for business to measuring the quantity supplied.

Cross elasticity of demand - this measure the responsiveness of quantity demanded of one good to a change in the price of other good.

Income elasticity of demand - it measure the responsiveness of quantity demanded to a change in consumer income.

Rahul Sunny answered 2 years ago

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