Elastic Vs Inelastic

Elastic is the result of the price changing and the consumer still demanding the produce. As for inelastic, this is the result of the price changing although the demand decreases. The difference between elastic and inelastic are determined by the demand of the product; as for elastic the consumer will always have a demand for the product such as water, food, and gas, and for inelastic the consumer will change the demand based on price of the product. Producers are interested in elasticity, because this enables the producers to wager the prices of the product, based off of consumer demand. Most producers want to obtain the maximum profit and as well as the sensitivity of the product with the changing of pricing. The total revenue test consists
Disney. A water bottle at the grocery store is priced at $2 the store sells 1,000 water bottles, this results in the total revenue being $2,000. ($2 x 1,000= $2,000) as for Disney the water bottles are prices at $4 Disney sells 1,000 water bottles also, but the total revenue is $4,000 ($4 x 1,000= $4,000). This example shows that water bottles are elastic based the total revenue of the water bottle. The four determinants of elasticity are, substitutes, percentage of income spent on item, luxury vs. necessitates, and emergency vs. time. Substitutes are inelastic when there is no subside for the product, and also elastic when there is many substitutes of the product. An example of a inelastic substitute is going the a football stadium and ordering a hot-dog, there is no substitute for this item which is prices at $4.00, the consumer is hungry and results in buying the hot-dog. An example of a elastic substitute would be buying a hot-dog at the grocery store and buying a package of hot dogs for $4.00, this results in double the food for the same price of one. The percentage of income spent on item, is based on location, and pricing of the