ECON616 Phase 2DB

ECON616 Phase 2DB

Basic Concept

As a matter of fact, the general rule of economics is that, whenever the price of products increases, as a result of this, the demands becomes lower. However, it further depends on the nature of the product as well as the trends of the market that defines the relative effect over the demand. For instance, if the substitute products are available, the elasticity would be high, and people will switch from one product to another, and if no substitutes are available the effect of price on demand would be inelastic. In addition to that, the role ...