I believe pirce insensityivity and price sensitivity is the same is price elastic and price inelastic.
Price inelastic is when the demand of a good or service is not affected by a change in the price. An example is oil, prices rise but demand changes very little, this is because oil is a every day necessity.
Price elastic is when the demand of a good or service is affected by a change in price. An example is cheddar cheese, if prices increase, demand will fall proportionaly to it, this is because there are alternatives to cheddar cheese and it is not necessary for everyone.
Answered Sat 23rd March, 2013 @ 12:18 by Rory Bush