Inelastic Demand Curve

If the value of the price elasticity of demand for a product is between zero and one, it is described as inelastic in demand and the demand curve will tend to be steep.

Diagram: Inelastic Demand Curve

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The price elasticity of demand is calculated by dividing the percentage change in demand by the percentage change in price. If the increase in demand is lower than the increase in price then the price elasticity is described as inelastic. This is shown by a steep demand curve as for a given change in price there is a smaller change in demand. (However, do look carefully at the scales on the axes).

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