Question
What is meant by inelastic demand? Compare it with perfectly inelastic demand.
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Answer
When the Percentage Change in Quantity Demanded is Lesser than the Percentage Change in Price, then it is termed as Inelastic Demand.
| Basis | Inelastic Demand | Perfedctly Inelastic Demand |
| Diagram |  |  |
| Definition | When the percentage (or proportionate) change in quantity demanded is lesser than the percentage (or proportionate) change in price, then it is termed as inelastic demand. | When the quantity demanded remains constant (or changes very minutely) with the too much change in its price (whether price increases or decreases) then it is termed as perfectly inelastic demand. |
| Co-efficient | Less than one (ep < 1) | Zero (ep = 0) |
| Real or Imaginary | Can be found in necessary goods. | Cannot be found in practical world. |
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