Toyota uses steel in the manufacturing process of automobiles in factories around the world.The price of steel may vary at different times throughout the year but Toyota only purchases the amount of steel needed to maintain their output goals at each facility.Thus,if the price increases,Toyota continues to purchase the amount of steel needed to build the number of cars they have determined to build.For Toyota,the demand for steel is most likely:

Question

Quizplus · Accepted Answer

The fact that Toyota only purchases the amount of steel needed to maintain their output goals implies that they are not very responsive to changes in the price of steel. This suggests that the demand for steel by Toyota is inelastic, meaning that changes in the price of steel have a relatively small effect on the quantity of steel demanded by the company.

Toyota Uses Steel in the Manufacturing Process of Automobiles in Factories