Inelastic Demand
A situation where the percentage change in quantity demanded is less than the percentage change in price (PED < 1 in abs...
Formula
PED = % change in quantity demanded ÷ % change in price
Real World
Apple can raise iPhone prices with minimal impact on sales volume because brand loyalty and ecosystem lock-in make demand highly inelastic — total revenue rises with each price increase.
Exam Focus
State PED value as between 0 and 1 (ignoring sign) and always link to the revenue outcome to secure application marks.
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