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You are expected to define (AO1) elasticity, and draw relatively elastic and inelastic demand (AO4) (SL+HL)
Elasticity of demand refers to how responsive the quantity demanded is for a good or service when price or income changes.
Demand is elastic when a change in price/income leads to a larger change in quantity demanded.
Demand is inelastic when a change in price/income leads to a smaller change in quantity demanded.
Some goods and services are more elastic than others.
Gasoline is quite demand inelastic because even if prices rise, people will still need it, and demand will not change significantly.
Candy is quite demand elastic because there are many substitutes/competing candy brands. So if the price of one increases, many customers will turn to competitors.
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