Answer:
Inelastic good
Explanation:
Price elasticity of demand ( PED) is calculated as follows
P.E.D = % change in Quantity Demanded
% change in price
=1.50 - 1.20 = 0.30
=$0.30/$1.50 x 100
=$0.2 x 100
=20%
The elasticity of demand
= 10%/20%
=0.5%
This good has an inelastic demand. The priced elasticity of demand is less than one. The demand is inelastic. A 20% change in price results in a smaller change in demand( 10%).
