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What is inelastic demand and does salt cigarettes or biscuits have the most and why?
Wiki User
∙ 12y ago
The concept of Inelastic Demand means that the goods are not responsive to any price changes. If we say a good faces an inelastic demand curve, this means that any price changes, increases or decrease will have little or no impact on the quantity demanded. For example, we can say that specific medication for certain illness can have an inelastic demand, as even if the price of the medication increases, there is little that the consumer can do, the consumer still needs to buy the medication, as he needs it. Hence little or no changes in the quantity demanded for the medication even if there are changes in the price.
You need to understand that several factors can affect the elasticity of demand like time period, percentage of income spent on the good and the number of substitutes.
To answer your 2nd question, Salt will have an inelastic demand. This is because there is not a lot of substitute to salt. Another reason is that people spend a small fraction of their monthly income on salt. Hence, any changes in the price of salt, will have little or no effect on the quantity demanded for salt.
Cigarettes will have an inelastic demand as well. As there is little substitutes and also people can be addicted to it. While biscuits will have an elastic demand. There can be quite a number of substitutes to biscuits. If the price of biscuits increases, immediately consumers will reduce the demand of biscuits, and opt for substitutes.
Wiki User
∙ 12y ago
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If the demand for a good is inelastic and the price of the good decreases?
Increase. Inelastic demand means that most consumers will continue to buy a good regardless of price.
What is a price cut when the demand for a normal good is price inelastic?
Demand is inelastic when changes the in price of a commodity do not effect (or have very little effect) the quantity of that product demanded. For most commodities, demand decreases with price increases and demand increases with price decreases.
Who generally bears most of a sales tax when the demand for the good taxed is inelastic?
the consumer
How generally bears most of a sales tax when the demand for the good taxed is inelastic?
the consumer
Who generally bears most of a sales tax when the demand for a good taxed is inelastic?
the consumer
Who generally bears most of a sales tax when the demand of the good taxed is inelastic?
the consumer
What is perfect inelastic demand?
In economic theory, a perfect inelastic demand is a demand for some product that cannot be reduced, either by higher prices or shortages, because it is something that people absolutely have to have at any cost. There would be very few examples of a perfect inelastic demand. Some people need a certain kind of medicine to treat their disease, such as a severe diabetic who needs insulin; this is a perfectly inelastic demand. A heroin addict must have his or her heroin, regardless of cost, so that too is a perfectly inelastic demand. But most products have some elasticity of demand. If you cannot afford fruit juice, you can probably drink water instead.
The difference between a elastic and inelastic demand?
Elastic demand changes according to some other factor. The demand for holdiay trees is elastic throughout the year because there is only damand during the winter season. Inelastic demand is constant. As you might have guessed, the demand for gasoline is inelastic because most families need a constant supply. Even during the so-called summer driving season, the uptick in demand is going to remain the same, unless prices cause what is called "demand destruction." This is what happened during 2009.
Why is kidney replacement considered to be an inelastic demand?
A demand curve is inelastic if the demand changes very little with price. If you needed a new kidney to live, most likely it would not matter if the hospital charged $1,000 or $500,000. You would find a way to get the money in order to live. In most modern countries, insurance makes sure that the price you pay is a tiny fraction of the actual cost, which also helps to make the curve inelastic.
What is a perfect inelastic demand?
When demand for a product or service does not change at all in response to changes in its price. Of course in the real world that rarely if ever happens; it's an extreme case used to illustrate one endpoint of the spectrum of supply-and-demand responses by consumers.
Which of the following commodities has the most inelastic demand and why?
Housing. housing can't change very quickly because building houses is expensive and time consuming.
The US imposes substantial taxes on cigarettes but not on loose tobacco When the tax on cigarettes went into effect the demand for cigarette rolling machines most likely?
I think the demand increased, causing prices of the machine to increase and quantity purchased to either fall or rise depending on how you look at it
