The document discusses the concept of elasticity, which measures the responsiveness of quantity demanded or supplied to price changes. There are three types of elasticity: 1. Price elasticity measures how quantity demanded responds to price changes. Demand can be elastic, inelastic, or unitary. 2. Income elasticity measures how quantity demanded responds to changes in consumer income. 3. Cross elasticity measures how the quantity demanded of one good responds to price changes of another good. It shows whether goods are substitutes or complements. Elasticity of supply also measures how quantity supplied responds to price changes. Determinants like storage costs, production ability, and time affect whether supply is elastic or