« Skin Care Clinique: The Quickest Way I Know To Learn About Skin Care | Home | Doing the hid conversion kits Myself »
Understanding Price Elasticity Of Demand
By admin | July 3, 2009
To fully understand the concept of price elasticity of demand, you have to look at the key word, “elasticity.” This word implies that there is flexibility in prices. They change according to demand and the ability of the particular consumers to pay differing amounts. For example, everyone uses shampoo, so in order to reach the lower income consumer, some of these products will be priced lower. However, because of the volume that is sold, there is still a profit even at the lower price. Salon shampoos will be purchased by less people with higher incomes who can afford the more expensive brand names. In the end both will show a profit either from a large amount sold, or a higher price.
Topics: Health | No Comments »