Elasticity of demand refers to the sensitivity of quantity demanded with respect to changes in another outside factor. There are many types of elasticity of demand. The one most relevant to businesses ...

Economists use elasticity of demand to gauge how responsive consumers are to changes in price and income, but investors can also use elasticity of demand to help make more informed investing decisions ...

In order for a small-business order to price her products or services correctly, she must be able to understand what impact that price will have on demand. In some cases, demand will rise or fall with ...

Price elasticity of demand is a measure of the degree to which changes in a product’s price affect how much of that product consumers purchase. At $1.99, you might impulse buy a bottle of Coke. At ...

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

Demand elasticity is a phenomenon where demand for a specific good or service changes depending on factors such as how it is priced, whether alternatives are available or local income trends.

Price elasticity measures how demand changes with price adjustments; key for investment decisions. Investors should focus on companies developing inelastic products for greater pricing power.

Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor. Claire's expertise lies in corporate finance & accounting, mutual funds, ...

The price elasticity of demand is a crucial concept in investing. It helps investors understand whether a company has pricing power or not. Can it boost profits by raising prices, leading to increased ...