The Key Difference Between Elastic vs Inelastic Demand

elastic vs inelastic demand
Feature	Elastic Demand	Inelastic Demand
Definition	When a small change in price causes a significant change in quantity demanded.	When a change in price has little to no effect on the quantity demanded.
Sensitivity to Price	Highly sensitive to price changes.	Not very sensitive to price changes.
Elasticity Coefficient	Greater than 1.	Less than 1.
Examples of Goods	Luxury items, electronics, restaurant meals.	Basic necessities like salt, fuel, insulin.
Consumer Reaction	Buyers reduce consumption significantly if prices rise.	Buyers continue purchasing even if prices rise.
Revenue Impact	Price increase leads to lower total revenue.	Price increase may lead to higher total revenue.
Availability of Substitutes	Many substitutes available.	Few or no substitutes available.
Time Period	More elastic in the long run.	Usually inelastic in the short run.
Purchase Type	Often discretionary purchases.	Often essential or habitual purchases.
Consumer Behavior	Consumers can delay or avoid purchase.	Consumers must purchase regardless of price.
Demand Curve Shape	Flatter curve.	Steeper curve.
Marketing Strategy	Focus on competitive pricing.	Focus on availability and convenience.
Income Effect	Higher for elastic goods.	Lower for inelastic goods.