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Discuss the Determinants of Price Elasticity of Demand When looking at the determinants that affect Price Elasticity of Demand (PED), I feel its best to explain what is meaning of this term individually and all together. The price is the cost of the product or service to the consumer and the demand is how many consumer wish to have that product or service. Elasticity is the effect that occurs to one variable, in this case it is the demand, after there is a change to another variable, this being the price. How we calculate the PED is by dividing the percentage of change in quantity demanded by the percentage of change in price. From this equation there can be three outcomes; the result is less than one, equal to one or greater than one. Each of these outcomes means three different things; if it is less than one the good is...

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