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Price elasticity of demand
This concept is quite important for the marketing managers. PED means the change in demand for a product in response to the change in price.
% change in demand/ % change in price
As a marketing manager you should be aware that how much the demand for your product will change if you increase or decrease the price of your product.
If the PED for your product is less than 1 that means your product is price inelastic and you can raise the price and the demand will be less affected. But if your product is price elastic i.e. more than 1, then a minor price increase might result in a great fall in demand.
