Question

1. The concept of elasticity for demand is importance for determining the prices of variousfactors of production. Discuss the various factors that influences the price elasticity ofdemand​

Answer 1

Answer:

The concept of elasticity for demand is of great importance for determining prices of various factors of production. Factors of production are paid according to their elasticity of demand. In other words, if the demand of a factor is inelastic, its price will be high and if it is elastic, its price will be low.