If the price of watermelons fell only a little bit when the supply of watermelons increased a lot, what could you conclude about the elasticity of demand for watermelons

Demand for water melon is inelastic

Explanation:

Demand elasticity is a measure of the changes of quantity demanded of a good with changes in price.

Also price is determined by the intersection between supply and demand curves.

When supply increases or decreases equilibrium price shifts.

In this scenario where increase in supply of water melon resulted in only a small reduction in price, it can be concluded that demand curve is nearly horizontal (that is inelastic).

Changes in supply does not vary price much.

This is illustrated in the diagram below

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