List Three Factors That Affect Elasticity of Demand

question 27

Essay

List three factors that affect elasticity of demand.Briefly describe how each affects demand.

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Definitions:

Sales Increase

A rise in the volume or amount of products or services sold by a business.

Break-Even Sales

The amount of revenue needed to cover both fixed and variable expenses, resulting in a net income of zero.

Variable Expenses

Costs that change in proportion to the activity of a business.

Fixed Expenses

Expenses that remain constant regardless of the amount of goods produced or sold, including lease payments, wages, and coverage costs.