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infoWhy this? Demand elasticities help us assess how strongly consumers respond to changes in prices and incomes, rather than simply identifying the direction of change. Linking consumer behaviour to pricing, marketing, and revenue allows us to evaluate how firms respond to changing demand and pursue competitive advantage.

scheduleWhy now? Following the study of business growth and competitive advantage, elasticity introduces quantitative tools for analysing how firms attract customers and generate revenue. This demand-side perspective complements the subsequent study of productive efficiency and strengthens our later analysis of revenue, profitability, and market power.