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The elasticity of demand is the sensitivity of demand for any product concerning the change in any other factor. The price elasticity estimates the change in demand for the quantity due to a change in prices. The demand's price elasticity is measured by % change in demand of the quantity divided by % change in the price. Price and demand are inversely related which means, the fall in prices will raise the demand of the product whereas the rise in prices will lead to a fall in demand. The price elasticity of demand(PED) varies from product to product.
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