Elastic or Inelastic? Mastering Price Elasticity of Demand
Student Worksheet
Meadowvale's gas prices rose from $2.50 to $3.50 a gallon between 2019 and 2021. Once transit added routes and a $50 monthly bus pass, gasoline consumption fell 20 percent from pre-2019 levels within six months, pushing elasticity toward the elastic side. A separate comparison pairs a designer handbag, where a 10 percent price rise cuts sales 15 percent, against insulin, where the same rise trims usage by only 2 percent.
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