Difference between revisions of "Inelastic good"
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| − | An inelastic good has a nearly constant demand despite an increase in price. Addictive goods such as tobacco, alcohol, gambling and Super Bowl tickets are typically inelastic, because the addicted consumer will buy | + | An '''inelastic good''' has a nearly constant demand despite an increase in price. Addictive goods such as tobacco, alcohol, gambling and Super Bowl tickets are typically inelastic, because the addicted consumer will buy them even at higher prices. |
Another example of an inelastic good is Matzoh at Passover. The price can increase and Jewish people will still purchase it for Passover. Kosher foods during Passover would likewise be inelastic. | Another example of an inelastic good is Matzoh at Passover. The price can increase and Jewish people will still purchase it for Passover. Kosher foods during Passover would likewise be inelastic. | ||
Revision as of 17:14, April 21, 2008
An inelastic good has a nearly constant demand despite an increase in price. Addictive goods such as tobacco, alcohol, gambling and Super Bowl tickets are typically inelastic, because the addicted consumer will buy them even at higher prices.
Another example of an inelastic good is Matzoh at Passover. The price can increase and Jewish people will still purchase it for Passover. Kosher foods during Passover would likewise be inelastic.