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SLOPE, GOVERNMENT PURCHASES LINE: The positive slope of the government purchases line is also termed the marginal propensity for government purchases (MPG). This slope is greater than zero but less than one, reflecting induced government purchases. The slope of the government purchases line affects the slope of the aggregate expenditures line and thus also affects the magnitude of the multiplier process.
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                           INELASTIC: The general relation between two variables in which relatively large changes in one variable (A) cause relatively small changes in another variable (B). In other words, large changes in variable A cause relatively small changes in variable B or the percentage change in variable B is smaller than the percentage change in variable A. This characterization of elasticity is most important for the price elasticity of demand and the price elasticity of supply. Inelastic is one of two general elasticity relations between two variables. The other is elastic. An inelastic relation between two variables is NOT a very responsive, or stretchable, relation. The inelastic relation is most often directed toward demand and supply in terms of the price elasticity of demand and the price elasticity of supply. In this context, demand or supply is said to be inelastic if the percentage change in quantity is smaller than the percentage change in price. This means that buyers or sellers are not responsive to price changes.However, other relations can also be thought of as inelastic. For example, demand might be inelastic relative to income. In this case, relative large changes in income are needed to trigger relatively small changes in demand. Demand and SupplyConsider the two sides of the market.- Demand: Inelastic demand exists if relatively large changes in price cause relatively small changes in quantity demanded. Inelastic demand means that changes in the quantity demanded are not very responsive to changes in the price. An inelastic demand has a coefficient of elasticity less than one (with the negative value ignored).
- Supply: Inelastic supply exists if relatively large changes in price cause relatively small changes in quantity supplied. Inelastic supply means that changes in the quantity supplied are not very responsive to changes in the price. An inelastic supply also has a coefficient of elasticity less than one.
Perfect and RelativeAn inelastic relation can fall into one of two categories--perfectly inelastic and relatively inelastic.- Perfectly Inelastic: Perfectly inelastic means that quantity demanded or supplied is unaffected by any change in price. In other words, the quantity is essentially fixed. It does not matter how much price changes, quantity does not budge. Perfectly inelastic demand occurs when buyers have no choice in the consumption of a good. In an analogous way, perfectly inelastic supply occurs when producers have no choice of the resources used in the production of a good.
- Relatively Inelastic: Relatively inelastic means that relatively large changes in price cause relatively small changes in quantity. In other words, quantity is not very responsive to price, but it does change. More specifically, the percentage change in quantity is less than the percentage change in price. Relatively inelastic demand occurs when buyers can choose only among a small number of imperfect substitutes-in-consumption. In an analogous way, relatively inelastic supply occurs when producers are able to switch resources among a small number of imperfect substitutes-in-production.
 Recommended Citation:INELASTIC, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 7, 2025]. Check Out These Related Terms... | | | | | | | | | | | | | | Or For A Little Background... | | | | | | | | | | | And For Further Study... | | | | | | |
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RED AGGRESSERINE [What's This?]
Today, you are likely to spend a great deal of time going from convenience store to convenience store trying to buy either 500 feet of telephone cable or a package of 4 by 6 index cards, the ones with lines. Be on the lookout for vindictive digital clocks with revenge on their minds. Your Complete Scope
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Post WWI induced hyperinflation in German in the early 1900s raised prices by 726 million times from 1918 to 1923.
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"It is not because things are difficult that we do not dare; it is because we do not dare that they are difficult. " -- Seneca, statesman, dramatist, philosopher
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