The supply for gold is inelastic because the majority of the production of gold comes from mining and only a small supply from scrap supplies. However the demand for gold is elastic. Because of gold’s many uses, there are few cheaper substitutes available. The physical properties of the metal make it more desirable for use for various reasons.
Of course to the average consumer, the only obvious use for gold might be for jewelry. Gold has been a symbol of wealth for thousands of years around the world. When the price of gold is higher, the demand is lower on the consumer end and when the price is lower, the demand for jewelry is higher. Jewelry makes up 85% of the use for gold. Over time, gold has been traded for money and because of this, some economists say that gold is not a commodity. However some economist say that the value of gold has depleted over the last few years with the value of money increasing, making gold more of a commodity.
The other 15% of usage for gold varies from glass materials in buildings, electronic parts, medicinal purposes, and awards. Gold is a precious metal. It is able to be hammered into thin sheets and stretched for use as well. Only silver is able to withstand electronic conduction like gold, but unlike silver, gold does not oxidize. It is one of the most inert naturally occurring metals on earth. Medically it has been used to treat cancers and rheumatoid arthritis. It is used for pigment in glass and thin sheets injected into glass or coated over glass in buildings are used as solar surfaces for climate control.
The durability of the gold mixed with other metals