Values that indicate elastic demand

Answer 1

Elastic demand occurs when a small change in price leads to a significant change in the quantity demanded. This is typically indicated by a price elasticity of demand (PED) value greater than 1. For example, luxury goods or non-essential items often exhibit elastic demand, as consumers can easily forego or substitute these products if prices rise. Conversely, necessities tend to have inelastic demand, where changes in price have little effect on the quantity demanded.