Economists use elasticity of demand to gauge how responsive consumers are to changes in price and income, but investors can also use elasticity of demand to help make more informed investing decisions ...

A customer normally buys a cup of coffee and one doughnut on the way to work in the morning. However, for one day only, the coffee shop has dropped the price of doughnuts by 30 percent. The customer ...

Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Goods and services can be either elastic or inelastic. Elastic means the ...

Elasticity in the financial sense is a term used to describe the degree to which a change in one variable leads to a change in another variable—how a price increase or decrease affects sales. If, for ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. David Kindness is a Certified Public ...

Elasticity is an economic concept that demonstrates the effect of a product price change on demand. For example, a product such as milk is an inelastic product, since a price change will not ...

Elastic products, like air travel, see demand vary with price changes, affecting investment volatility. Inelastic goods, such as insulin, maintain steady demand despite price fluctuations, offering ...

The challenge is wrapping your head around the difference between elasticity and inelasticity of demand. Elasticity of demand measures how much the demand for a product or service changes relative to ...