Elasticity

A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which individuals (consumers/producers) change their demand/amount supplied in response to price or income changes.

Calculated as:

Elasticity

Elasticity is used to assess the change in consumer demand as a result of a change in the good's price. When the value is greater than 1, this suggests that the demand for the good/service is affected by the price, whereas a value that is less than 1 suggest that the demand is insensitive to price.

Businesses often strive to sell/market products or services that are or seem inelastic in demand because doing so can mean that few customers will be lost as a result of price increases.


Investment dictionary. . 2012.

Synonyms:

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  • Elasticity — may refer to:*Elasticity (physics), continuum mechanics of bodies which deform reversibly under stressVarious uses are derived from this physical sense of the term, especially in economics:*Elasticity (economics), a general term for a ratio of… …   Wikipedia

  • Elasticity — E las*tic i*ty ([=e] l[a^]s*t[i^]s [i^]*t[y^]), n. [Cf. F. [ e]lasticit[ e].] 1. The quality of being elastic; the inherent property in bodies by which they recover their former figure or dimensions, after the removal of external pressure or… …   The Collaborative International Dictionary of English

  • Elasticity — Elasticity. См. Упругость. (Источник: «Металлы и сплавы. Справочник.» Под редакцией Ю.П. Солнцева; НПО Профессионал , НПО Мир и семья ; Санкт Петербург, 2003 г.) …   Словарь металлургических терминов

  • elasticity — 1660s; see ELASTIC (Cf. elastic) + ITY (Cf. ity) …   Etymology dictionary

  • Elasticity — A term used to indicate the power of recovery to normal of fibres and yarns which have been stretched by tensile stress …   Dictionary of the English textile terms

  • elasticity — [n] stretchiness adaptability, adjustability, flexibility, fluidity, give*, malleability, plasticity, pliancy, resilience, rubberiness, springiness, suppleness; concept 731 Ant. rigidity …   New thesaurus

  • elasticity — [ē΄las tis′ə tē, i las΄tis′ə tē] n. pl. elasticities 1. the quality or condition of being elastic; specif., a) springiness; flexibility; resilience b) buoyancy of spirit c) adaptability 2. Econ. the degree to which the demand for, or supply of,… …   English World dictionary

  • elasticity — /i la stis i tee, ee la stis /, n. 1. the state or quality of being elastic. 2. flexibility; resilience; adaptability: a statement with a great elasticity of meaning. 3. buoyancy; ability to resist or overcome depression. 4. Physics. the property …   Universalium

  • elasticity — Fin the measure of the sensitivity of one variable to another. EXAMPLE In practical terms, elasticity indicates the degree to which consumers respond to changes in price. It is obviously important for companies to consider such relationships when …   The ultimate business dictionary

  • Elasticity — (Roget s Thesaurus) < N PARAG:Elasticity >N GRP: N 1 Sgm: N 1 elasticity elasticity springiness spring resilience renitency buoyancy GRP: N 2 Sgm: N 2 rubber rubber India =>(n) rubber latex …   English dictionary for students

  • elasticity — [[t]i͟ːlæstɪ̱sɪti, ɪlæ̱st [/t]] elasticities 1) N UNCOUNT The elasticity of a material or substance is its ability to return to its original shape, size, and condition after it has been stretched. Daily facial exercises help her to retain the… …   English dictionary

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