Price Elasticity of Demand

Price Elasticity of Demand (PED) is the sensitivity of demand to a change in p............

If the percentage change in price leads to a greater percentage change in the quantity demanded, the answer will be greater than 1. This indicates that demand is relatively responsive to a change in price. What does this refer to?

• Elastic

• Inelastic

A supermarket sells essential products such as bread and milk. Are these products likely to be elastic or inelastic?

• Inelastic

• Elastic

One marketing strategy might be to lower prices. If a manager lowered the prices of his/her products, which type of product would be more likely to increase revenue?

• Elastic

• Inelastic

Your calculations for PED have given you an answer of -1, is the product elastic or inelastic?

• Inelastic

• Elastic

An answer for PED with -0.? indicates what type of product?

A business can reduce the PED by b......... loyalty.

Complete the formula to calculate PED:

= % change in quantity demanded

% change in ................