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POLITICAL  ECONOMY

of  elasticity  in  demand  can  be  measured  with
reference  to  the  elasticity  which  is  termed
“  unity.”  Demand  is  said  to  have  elastic
unity  when  a  fall  in  the  price  involves  such
increase  of  sales  that  the  total  amount  paid
for  the  aggregate  of  the  thing  sold  remains
the  same.  Beneath  is  represented  a  demand
with  an  elasticity  at  first  greater  than  unity,
then  equal  to  unity  and  finally  less  than
unity.  Let  us  suppose  that  the  article
referred  to  is  some  kind  of  soap.

Price  per  lb.  Total  sal  os  in  Total  receipts  in
in  pence.  lbs.  per  month.  pence  per  month.
10  ..  ..  30  ..  ..300
9  ..  ..  40  ..  ..  360
8  ..  ..  50  ..  ..  400
7  ..  ..  60  ..  ..420
6  ..  ..  70  ..  ..420
5  ..  ..  84  ..  ..  420
4  ..  ..  100  ..  ..  400
2  .  .  ..  150  ..  ..  300
1  ..  ..  250  ..  ..250
demand  is  greater  than
prices  lOd.  and  7d.,  less
than  unity  between  the  prices  5d.  and  Id.,
and  equal  to  unity  between  the  prices  7d.
and  5d.

The  elasticity  of
unity  between  the

One  of  the  simplest  generalisations  in