Friday, July 20, 2018

ELASTICITY

Elasticity: Elasticity is a measure of the sensitivity of one variable to another

In another words percentage change that will occur in one variable in response to a percentage change in another variable.

DETERMINANTS OF ELASTICITY:
There are two types of elasticity they are suplly and demand
Supply                              Demand
1. Flexibility                 1. Price of good
2. Mobility of inputs   2. Price of substitute  3. Durability                 3. Income of customer
4. Time.                          4. Advertising to their
                                            Promotional                                                          measures

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