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We say that the PEoD is perfectly inelastic.
When the price elasticity of oil is superior to 1 it means that the percentage change in quantity demanded is greater than the percentage change in price thus the total revenue of oil producers fall. We say that the PEoD is elastic.
When the price elasticity of oil is inferior to 1 it means that the percentage change in quantity demanded is less than the percentage change in price thus the total revenue of oil producers rises...
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We say that the PEoD is elastic.
When the price elasticity of oil is inferior to 1 it means that the percentage change in quantity demanded is less than the percentage change in price thus the total revenue of oil producers rises. We say that the PEoD is inelastic.
When the price of elasticity of oil equals 1 it means the percentage change in quantity demanded equals the percentage change in price thus when the price increases total revenues of oil producers remain unchanged...
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