Is the demand for rice inelastic?

Answer by  adawg (247)

In some countries, especially in Southeast Asia, they eat rice in their diet every day, thus demand is relatively inelastic. In other countries, like the U.S., rice demand is elastic.

Answer by  Gus28 (683)

Basic issue: If price raised, demand lessens. Price reduced, demand increases. Income elasticity of demand (YED) measures the 1% percentage change of income. When the YED is less than one percent it is inelastic, greater than 1% it is elastic. Since rice is a staple, the probabilty is it's inelastic.