Consumers usually buy more of a good when its price is lower when their incomes are higher when the prices of substitutes for the good are higher or when the prices of complements of the good are lower. Our discussion of demand was qualitative not qualitative. That is we discussed the direction in which quantity demanded moves but not the size of the change. To measure how much consumers respond to change in these variables, economists use the concept of elasticity. The Price Elasticity of Demand and Its Determinants The law of demand states that a fall in the price of a good raises the quantity demanded. The price elasticity of demand measures how much the quantity demanded responds to a change in price. Demand for a good is said to be elastic if the quantity demanded responds substantially to change in the price. Demand is said to be inelastic if the quantity demanded responds only slightly to change in the price. The price elasticity of demand for any good m...