The Price elasticity of demand is the term that describes the ratio of change in a price and its effect on the quantity of the product demanded.
This refers to the percentage change in the quantity demanded that is divided by the percentage change in price.
Normally, when the demand is elastic, this means that the quantity demanded changes by a relatively larger amount than the price change. So, if the consumers are sensitive to price changes, the demand is then elastic, if they are unresponsive, then demand is inelastic
Hence, Price elasticity of demand is the term that describes the ratio of change in a price and its effect on the quantity of the product demanded.
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