ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Perfectly inelastic demand curve shows the elasticity of demand where the demand does not change with any change in price. Hence the demand curve is a vertical curve straight line parallel to OY Axis.

Detailed explanation-2: -An inelastic demand is one in which the change in quantity demanded due to a change in price is small. If the formula creates an absolute value greater than 1, the demand is elastic. In other words, quantity changes faster than price. If the value is less than 1, demand is inelastic.

Detailed explanation-3: -Inelastic demand is exemplified by the demand for gasoline. Even in cases of a price increase or decrease, consumers won’t buy more or less gas. Inelastic demand is graphically represented by a steep demand curve. The more inelastic the demand, the steeper the curve.

Detailed explanation-4: -Lack of urgency in demand for a product means that a product is not a basic need. The demand for such products can therefore be postponed in case there is a rise in the prices. Thus, the demand will tend to be elastic.