Perfect, Zero, Infinite, and Constant Elasticity
What is Perfect Elasticity and Inelasticity?
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What is Elasticity?
Elasticity measures the extent to which the demand for a good changes with the change in another metric. The most common metric is price; but, there can be other things - such as changes in demand or price for other goods.
What is Infinite Elasticity or Perfect Elasticity?
Infinite elasticity or perfect elasticity is when quantity demanded for a good or the quantity supplied by producers changes by an infinite amount in response to any change in price at all.
What is Zero Elasticity or Perfect Inelasticity?
Zero elasticity or perfect inelasticity occurs when a percentage change in price results in zero change in the quantity of the good demanded.
What is Constant Unitary Elasticity?
Constant unitary elasticity is defined as when a percentage change in one element (such as price) results in the exact same percentage change in the quantity demanded. For example, price and quantity demanded are in lock step.