Please make sure you print screen/write down/scan the following factors effecting Price Elasticity of Demand. It is important that you can recognise whether a product/service is inelastc and how this may effect business decisions and government taxation policy;
1. The number of substitutes available (more subs = more elastic)
2. The degree of necessity. (Necessities inelastic/luxuries elastic)
3. The % of a consumers income the product takes up. (small % = inelastic, large % elastic)
4. Addictiveness of good. (coffee, cigarettes = inelastic)
5. The time period under consideration. (more time = more elastic)
6. Peak Vs off peak.......you answer this one!!!!
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