How is the slope of the demand curve related to responsiveness?
The slope of a demand curve is an inadequate measure of responsiveness, because its value depends on the units of measurement used. For this reason, elasticities are calculated using percentages. 12. What is price elasticity of demand and what are its extremes? The price elasticity of demand lets us know the percentage change we could expect in the quantity demanded of a good for a 1% change in price. Perfectly inelastic demand does not respond to price changes, its numerical value is zero. Perfectly elastic demand for a product drops to zero when there is a very small price increase. Unitary elastic demand describes a relationship in which the percentage change in the quantity of a product demanded is the same as the percentage change in price; its numerical value is -1. Elastic demand is demand in which the percentage change in the quantity of a product demanded is larger than the percentage change in price. Inelastic demand is demand in which the percentage change in the quantity of
