Economists use elasticity of demand to gauge how responsive consumers are to changes in price and income, but investors can also use elasticity of demand to help make more informed investing decisions ...

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

Demand elasticity is a phenomenon where demand for a specific good or service changes depending on factors such as how it is priced, whether alternatives are available or local income trends.

Price elasticity measures how demand changes with price adjustments; key for investment decisions. Investors should focus on companies developing inelastic products for greater pricing power.