The chart to the right displays the five alternatives based on the coefficient of elasticity (E). In technical shorthand (typically used by economists who were originally trained as court stenographers), the coefficient of elasticity (E) is given as:

0 < E < 1

This technical shorthand works for both the price elasticity of demand and the price elasticity of supply, because the negative value of the price elasticity of demand is ignored. If the negative sign on the price elasticity of demand is not ignored, then relatively inelastic demand is specified as -1 < E < 0.

Two Curves

Relatively Inelastic Curves

The most notable note worth noting is that both curves are very steep. They are not perfectly vertical, as would be true for perfectly inelastic demand and supply, but they ARE very steep. The steepness of these curves is designed to visually indicate that relatively small changes in quantity result from relatively large changes in price.

However, having highlighted the steepness of these curves, please note that slope and elasticity are two different concepts. In particular, it is NOT possible to determine the elasticity of a demand curve JUST by looking at its slope. A steeply sloped demand curve, like the one displayed here, actually could be relatively elastic. The key to indicating relatively inelastic demand is that this is the lower segment of the curve, the part near the horizontal quantity axis.

An example or two should help illustrate relatively inelastic demand and relatively inelastic supply.

Demand

As such, the demand for 4M Cable Television is relatively inelastic. 4M Cable Television can change prices and buyers continue to buy ABOUT the same quantity. If the price increases too much, then 4M Cable Television buyers will install satellite systems, read books, or rent feature films on DVD. If the price falls too much, non-4M customers will decide to buy the 4M Cable Television services. Because these alternatives are NOT close substitutes, it takes relatively large price changes to induce buyers to switch.

Supply

While it might seem as though duct tape (that shiny gray tape that is used for every conceivable purpose EXCEPT sealing ventilation ducts) is easily produced by switching resources from the production of cellophane tape, electrical tape, or adhesive tape, Mona Mallard Duct Tape has a special "something" that generates a relatively elastic supply. That special something is quagliminium, a rare adhesive substance found only in the natural vegetation growing in the isolated country of Northwest Queoldiolia. Therefore, to increase the quantity supplied of duct tape, Mona Mallard must acquire greater amounts of quagliminium, which is always an expensive proposition.