## Demand

## Negative sign

The mathematical value which is derived from the calculation is negative. A negative value indicates an inverse relationship between price and the quantity demanded. However, the negative sign is ignored.

## Range of PEDThe value of PED might range from 0 to ?

Range of PEDThe value of PED might range from 0 to ?

Lets take a look at various types of PED.

Lets take a look at various types of PED.

## Perfectly Inelastic demand

In this case the PED =0 That means, any change in price will not have any effect on the demand of the product. Or in other words, the percentage change in demand will be equal to zero. It is hypothetical situation and does not exist in real world.

Perfectly elastic demand In this case the PED =?

The demand changes infinitely at a particular price. Any change in price will lead to fall of demand to zero. It is hypothetical situation and does not exist in real world.

However Normal goods have value of PED between 0 and ?. These can be classified as Inelastic demand When a product has a PED less than 1 and greater than 0, it is said to be have an inelastic demand. The percentage change in demand is less than the percentage change in price of the product.

Demand for a product is said to be

Perfectly elastic demand In this case the PED =?

The demand changes infinitely at a particular price. Any change in price will lead to fall of demand to zero. It is hypothetical situation and does not exist in real world.

However Normal goods have value of PED between 0 and ?. These can be classified as Inelastic demand When a product has a PED less than 1 and greater than 0, it is said to be have an inelastic demand. The percentage change in demand is less than the percentage change in price of the product.

Demand for a product is said to be

**ELASTIC**if the percentage change is demand is more than the percentage change in price.