Difference Between Elastic Demand And Inelastic Demand
The major dissimilarities or difference between elastic and inelastic demand can be highlighted as follows:
1. Introduction
Elastic Demand: Type of demand which responses or changes very quickly if there is a small change in the price or other factors.
Inelastic Demand: Type of demand which does not response or change quickly (very small change or no change) if there is a change in the price and other factors such as income and substitutes.
2. Nature
Elastic Demand: It is responsive or highly variable in nature
Inelastic Demand: It is sticky in nature
3. Applicable
Elastic Demand: This type of demand is applicable for comfort and luxury products
Inelastic Demand: This type of demand is applicable for necessity goods or daily required products
4. Demand Curve
Elastic Demand: It is flat
Inelastic Demand: It is steeper
5. Substitute Products
Elastic Demand: Substitute products are widely available
Inelastic Demand: Very few substitutes are available
6. Price Effect
Elastic Demand: If the price is increased, then total revenue will decrease and vice versa.
Inelastic Demand: If the price is increased then total revenue will also increased and vice versa.
7. Consumers Sensitivity To Price Change
Elastic Demand: Highly sensitive
Inelastic Demand: Less sensitive
Also Read:
Also Read:
8. Quantity
Elastic Demand: Quantity or demand will decrease if the price increases
Inelastic Demand: Quantity will remain same in case of increase in price
9. Examples
Elastic Demand: Television, car, jewelry etc.
Inelastic Demand: Medicine, water, milk etc.
Elastic Demand Vs Inelastic Demand (Comparison Chart)
I hope this post is helpful to understand the difference between elastic demand and inelastic demand and to make comparison between them.
Elastic Demand Vs Inelastic Demand (Comparison Chart)
Basis For Difference
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Elastic Demand
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Inelastic Demand
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Introduction
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Kind of demand that responses quickly in case of small change in price or other factors
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Kind of demand that does not response quickly in case of change in price or other factors
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Nature
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Responsive/Variable
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Sticky
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Applicable For
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Comfort and luxury goods
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Necessity goods
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Demand Curve
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Flat
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Steeper
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Substitute Products
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More
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Less
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Consumers Sensitivity
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High
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Less
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Effect On Quantity
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Quantity decreases if price increases
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Quantity remains same in case of increase in price
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Examples
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Television, jewelry, car etc
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Medicine, milk, water etc.
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Price Effect
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Revenue decreases if price is increased and vice versa
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Revenue increases if price is increased and vice versa
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I hope this post is helpful to understand the difference between elastic demand and inelastic demand and to make comparison between them.
