Perfectly Inelastic Demand (2024)

FAQs

What is the answer to perfectly inelastic demand? ›

Perfectly inelastic demand is an economic condition in which a change in the price of a product or a service has no impact on the quantity demanded or supplied because the elasticity of demand or supply is equal to zero.

What Does It Mean If Demand Is Perfectly Inelastic? Demand is said to be "perfectly inelastic" if the demand for that product will remain consistent, regardless of any price changes.

Perfectly inelastic is where a small increase or decrease in the price of a product will have no effect on the quantity that is demanded or supplied of that product. There is no elasticity of demand or supply for the product. This will rarely happen in real life, but it is used as a valuable economic theory.

- Perfectly inelastic demand means that consumers will buy exactly the same amount no matter how high or low the price.

If a good's price elasticity is 0 (no amount of price change produces a change in demand), it is perfectly inelastic. If price elasticity is exactly 1 (price change leads to an equal percentage change in demand), it is known as unitary elasticity.

Perfectly Inelastic (PED = 0)

That is, there is no change in the quantity demanded in response to the change in price. The demand curve remains vertical. Demand is completely unresponsive to the change in price.

The most common goods with inelastic demand are utilities, prescription drugs, and tobacco products. Businesses that offer such products maintain greater flexibility with prices because demand remains constant even if prices increase or decrease.

A perfectly inelastic collision occurs when the maximum amount of kinetic energy of a system is lost. In a perfectly inelastic collision, i.e., a zero coefficient of restitution, the colliding particles stick together. In such a collision, kinetic energy is lost by bonding the two bodies together.

Answer and Explanation:

The answer is b) Buyers purchase the same amount when the price rises or falls .

What is an example of a perfectly inelastic supply? ›

Perfectly inelastic supply is when the PES formula equals zero. That is, there is no change in quantity supplied when the price changes. Examples include products that have limited quantities, such as land or a painting from deceased artists.

Suppose two similar trolleys are traveling towards each other. They collide, but because the trolleys are equipped with magnetic couplers they join together in the collision and become one connected mass. This type of collision is perfectly inelastic because the maximum possible kinetic energy has been lost.

The best description for a perfectly inelastic collision free of external forces is that kinetic energy is never conserved.

An inelastic collision is one in which kinetic energy is not conserved. A perfectly inelastic collision (also sometimes called completely or maximally inelastic) is one in which objects stick together after impact, and the maximum amount of kinetic energy is lost.

Perfect elastic demand means that quantity demanded will increase to infinity when the price decreases, and quantity demanded will decrease to zero when price increases.

A PED coefficient equal to zero indicates perfectly inelastic demand. This means that demand for a good does not change in response to price. Perfectly Inelastic Demand: When demand is perfectly inelastic, quantity demanded for a good does not change in response to a change in price.

Perfect elastic demand means that quantity demanded will increase to infinity when the price decreases, and quantity demanded will decrease to zero when price increases.

Perfect inelasticity refers to a situation in which the quantity demanded does not change at all, regardless of the price. Perfect elasticity refers to a situation in which the quantity demanded is extremely sensitive to changes in price, with even a small change in price leading to a large change in quantity demanded.