ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -An inelastic demand or supply curve is one where a given percentage change in price will cause a smaller percentage change in quantity demanded or supplied. Unitary elasticity means that a given percentage change in price leads to an equal percentage change in quantity demanded or supplied.

Detailed explanation-2: -When percentage change in quantity demanded is equal to the percentage change in price, the elasticity of demand is unitary elastic.

Detailed explanation-3: -If the number is equal to 1, elasticity of demand is unitary. In other words, quantity changes at the same rate as price.

Detailed explanation-4: -If the change in quantity purchased is the same as the price change (say, 10% ÷ 10% = 1), then the product is said to have unit (or unitary) price elasticity. Finally, if the quantity purchased changes less than the price (say, -5% demanded for a +10% change in price), then the product is deemed inelastic.

Detailed explanation-5: -Demand or supply for which the elasticity coefficient is equal to 1; means the percentage change in the quantity demanded or supplied is equal to the percentage change in price.