Price Elasticity of Demand

Description

Elasticity of demand (Ed) means degree of connection – how are sales (total revenue) connected to price? What happens when price is changed? Remember that a change in price can not change the supply or demand of the item. If you are managing a company how would elasticity impact your overall strategy? Would you want the elasticity to be more or less elastic and why? How would you implement your decision – use real world examples.