How does the concept of perfectly inelastic demand impact the benefits that consumers receive from trade?

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2026-06-01 01:00

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The concept of perfectly inelastic demand means that the quantity demanded does not change with price. In the context of trade, if a good has perfectly inelastic demand, consumers will not benefit as much from trade because they will still buy the same amount regardless of price changes. This limits the potential gains from trade for consumers.

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