Elasticity of supply and demand | Article about elasticity of supply and demand by The Free Dictionary
elasticity of supply and demand
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elasticity of supply and demand (ECONOMICS) the degree of change in supply of a good or service in response to a change in the price offered by consumers (elasticity/inelasticity of supply); or degree of change in the quantity of goods and services demanded in response to a change in prices (elasticity/inelasticity of demand or demand elasticity). For example, the change in demand as a result of a price reduction may be small if the food is already in reasonable supply (inelasticity); and, where a fall in price reflects an overall increase in supply in a competitive market, this may also result in an overall reduction in the income of the suppliers.