Definition
- Time period
- The time period is how long buyers have to respond; demand is usually more elastic in the long run, once they have found ways to switch.
Example
Can you think of an example of time period?
When energy prices rise, a household can only turn the heating down this winter. Over several years it can insulate the loft, buy a better boiler or move closer to work.
Test yourself
Can you name the four determinants of price elasticity of demand?
Learn it properly: the module
Also in: Price elasticity of supply