What will be elasticity of demand for rare articles?
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perfectly elastic type of demand
sarthaksk:
But how??
elasticity of demand means the demand varied with respect to price.
so relative change in quantity demanded divided by relative change in price
sry perfectly elastic means the demand is infinity
if we take diamond as example even though it's price is high it's demand is also high due to it is very rare.
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The demand for rare articles will be perfectly inelastic, as even if there is a change in the price, the quantity supplied will not be changed.
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