What is elasticity, in economics terms?

Question

also can someone give me an example of a question on elasticity that you might find in an econ 101 (micro-economics) exam, and how to solve it.

thank you.

Answer 1

If something is elastic, it means the demand for it reacts to price. So if wheat bread starts costing a lot more money, people will buy less of it.

Something being inelastic means people will still buy it at a pretty steady rate, no matter what the price is. A good example of this is gasoline.

Answer 2

Is the demand for gasoline in the US elastic or inelastic?

The demand for gasoline is somewhat inelastic, as demand has not declined very much even though the retail price has increased by 33% over the past year. (Another inelastic example might be basic needs like "food and water")