Explain the price elasticity of demand of -0.12 for consumer product?
Price elasticity of demand is a measure of the change in the quantity demanded or purchased of a product in relation to its price change. Expressed mathematically, it is:
Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price
When the price elasticity of demand is -0.12 it means that: If price for consumer product is increase on 1%, the Quantity of Demanded consumer product will decrease by 0.12%. We can conclude that demand for this consumer product is inelastic and this daily use good.