Xbox

Price elasticity

Price elasticity: Xbox

Price elasticity refers to the degree of responsiveness of consumers and suppliers to price changes: the degree to which the demand or supply of a good or service is affected by changes in price. Although, in general, demand goes up as price goes down and supply goes up as price goes up (and vice versa) for most goods and services, the degree to which this is true is not universal (Elasticity, 2011, Investopedia). Necessities, particularly in the short run, like gas and staple groceries, are less resistant to changes in price than non-necessities. For example, if the price of gas plummets, in the short-term there is only so much 'extra' driving someone can or will want to do. If the price of gas rises, there is only so much driving a person can cut out of his or her life, unless he or she...
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