This document discusses the different types of price elasticity of demand. It defines key economic concepts like price, demand, supply, and quantity. Price elasticity of demand measures the responsiveness of demand for a good or service to a change in its price. There are five types of price elasticity: perfectly elastic demand, perfectly inelastic demand, unitary elastic demand, relatively elastic demand, and relatively inelastic demand. Each type is defined by the proportional relationship between a change in price and the resulting change in demand. The formulas for calculating price elasticity are also provided.

1. ECONOMICS
TOPIC
Types of price elasticity of demand

2.  PRICE - The amount of money that a
buyer gives to a seller in exchange for a
good or a service.
 DEMAND – The consumers desire
and willingness to buy a product or service
at a given period or over time.
 SUPPLY – The total amount of specific
good or service that is available to
consumers.
 QUANTITY - The number of goods
and services that suppliers will produce and
sell at a given market price.

3. PRICE ELASTICITY OF DEMAND
 The price elasticity of demand is a
measurement of the change in demand for a
good or service in relation to a change in its
price.
 Economists use price elasticity to explain
how supply or demand changes and
understand the workings of the real
economy, despite price changes.
For example, Individuals need to buy fuel to
get to work or fly around the world. Even if
price increases, people are likely to purchase
exactly the same amount of fuel still.

4. TYPES OF PRICE ELASTICITY OF DEMAND

5.  PERFECTLY ELASTIC DEMAND – The elasticity of demand is when there is no change in
the price leads to infinite change in demand is known as perfectly elastic demand.
Formula, PED = percentage change in demand / percentage change in price.
ED = INFINITY

6.  PERFECTLY INELASTIC DEMAND – The demand remains constant even though price
changes (or) no change in demand leads to infinite change in price is known as perfectly inelastic demand.
Formula, PED = percentage change in demand / percentage change in price.
ED = ZERO

7.  UNITARY ELASTIC DEMAND – The proportionate change in demand is equal the
proportionate change in price is known as unitary elastic demand. It is a rectangular hyperbola shape.
Formula, PED = percentage change in demand / percentage change in price.
ED = 1

8.  RELATIVELY ELASTIC DEMAND – The proportionate change in demand is greater than
the proportionate change in price is known as Relatively elastic demand.
Formula, PED = percentage change in demand / percentage change in price.
ED = >1

9.  RELATIVELY INELASTIC DEMAND – The proportionate change in
demand is less than the proportionate change in price is known as Relatively inelastic demand.
Formula, PED = percentage change in demand / percentage change in price.
ED = <1

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PRESENTED BY
D. ISWARYA