Elasticity of Demand:
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The law of demand explains that demand will change due to a change in the price of the commodity. But it does not explain the rate at which demand changes to a change in price. The concept of elasticity of demand measures the rate of change in demand.

Demand extends or contracts with change in price. This quality of demand by virtue of which it changes called elasticity of demand. Elasticity means sensitiveness or responsiveness. Elasticity of demand expresses the degree of correlation between demand and price. It is the measure of the responsiveness of demand to changing price.

Elastic and Inelastic Demand:
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A change in demand is not always proportionate to the change in price. A small change in price may lead to a great change in demand. In that case, we shall say that the demand is elastic. If, on other hand, even a big change in price there is followed only by a small change in demand, it is said to be a case of inelastic demand. For example, demand of mobile is elastic, while demand of salt is inelastic.