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price elasticity of demand

elastic demand

inelastic demand

unit elastic demand or supply

Quantity demanded changes with the price

Consumers buy more or less of a product when the price change…

Demand does not significantly increase or decrease with a cha…

Ed =1 Sd =1; ... EX: 20% change in price = 20% change in supply…

price elasticity of demand

Quantity demanded changes with the price

elastic demand

Consumers buy more or less of a product when the price change…

Price elesticity of demand

Price elasticity formula

Unit elasticity

Elastic demand

The responsiveness of consumers to a price change

Change in quantity demanded/ original quantity demanded •\• c…

When the amount demanded & change of price percentages are th…

Modest price change causes large changes in quantity purchased

Price elesticity of demand

The responsiveness of consumers to a price change

Price elasticity formula

Change in quantity demanded/ original quantity demanded •\• c…

Elasticity

Price elasticity of demand

Formula, take absolute value

Midpoint formula: used for elasticity…

the measure used by economists to determine the responsivenes…

measures the responsiveness of quantity demanded to changes i…

%∆ quantity demanded / %∆ price

[(Q2 - Q1)/ (Q1 + Q2 / 2)] / [(P2 - P1)/(P1 + P2 /2)]

Elasticity

the measure used by economists to determine the responsivenes…

Price elasticity of demand

measures the responsiveness of quantity demanded to changes i…

Elasticity formula

Elasticity Measures

Elasticity of Demand

Elasticity of Supply

Mid-Point Formula

How responsive is the dependent variable to the independent v…

Own Price; [% Change in Q/ % Change in P]... Decrease/Increase

% Change in Qs/ % Change in P... Increase/Increase

Elasticity formula

Mid-Point Formula

Elasticity Measures

How responsive is the dependent variable to the independent v…

Elasticity

Elasticity of Demand

When Elasticity of Demand is Greater t…

When Elasticity of Demand is equal to…

Refers to the degree of responsiveness in supply or demand in…

Measure of how does a change in price impact the quantity dem…

...

...

Elasticity

Refers to the degree of responsiveness in supply or demand in…

Elasticity of Demand

Measure of how does a change in price impact the quantity dem…

What is utility?

What is the Law of Diminishing Utility?

What is Utility Maximization?

What is a Util?

The satisfaction gained from consuming a good

As consumption increases, the marginal utility obtained from…

Consumer allocates her income so that the last dollar spent o…

One unit of satisfaction

What is utility?

The satisfaction gained from consuming a good

What is the Law of Diminishing Utility?

As consumption increases, the marginal utility obtained from…

Price elasticity of demand

Elastic demand

Inelastic demand

Price elasticity of demand equation

Degree of responsiveness or sensitivity of consumers to a cha…

when consumers are relatively responsive to price changes

Consumers are relatively unresponsive to price changes

Average percentage change in quantity demand over the average…

Price elasticity of demand

Degree of responsiveness or sensitivity of consumers to a cha…

Elastic demand

when consumers are relatively responsive to price changes

Price elasticity of demand (PED)

Elastic demand

Inelastic demand

Cross elasticity of demand (XED)

is a measure of the responsiveness of the quantity demanded o…

means that a change in the price of a good or service will ca…

means that a change in price of a good or service will cause…

is a measure of the responsiveness of the demand for a good o…

Price elasticity of demand (PED)

is a measure of the responsiveness of the quantity demanded o…

Elastic demand

means that a change in the price of a good or service will ca…

Price elasticity of demand

Elastic demand

Inelastic demand

Unit elastic demand

Measures how much demand changes in response to a change in p…

A percentage change in price causes a greater percentage chan…

A percentage change in price causes a smaller percentage chan…

A percentage change in price causes an equal percentage chang…

Price elasticity of demand

Measures how much demand changes in response to a change in p…

Elastic demand

A percentage change in price causes a greater percentage chan…

Elasticity

The price elasticity of demand

Price elasticity of demand, greater th…

price elasticity of demand, less than 1

measures the strength of the buyers response to a change in a…

percent change in Quanity demanded of good x/ percent change…

elastic

inelastic

Elasticity

measures the strength of the buyers response to a change in a…

The price elasticity of demand

percent change in Quanity demanded of good x/ percent change…

Elasticity

Inelastic

Elastic

Unit elastic

Elasticity of demand with respect to its own price a.k.a. Sen…

As Price increases, quantity demanded slightly decreases, not…

As price increases, quantity demanded decreases a lot, very s…

Coefficient is 1, neither elastic or inelastic

Elasticity

Elasticity of demand with respect to its own price a.k.a. Sen…

Inelastic

As Price increases, quantity demanded slightly decreases, not…

PED

PED formula

D=inelastic

D=elastic

Measures the responsiveness of quantity demanded due to a cha…

%🔺QD / %🔺Price

An increase in price will lead to an increase in revenue ... A…

An increase in price will lead to a fall in revenue.... A chang…

PED

Measures the responsiveness of quantity demanded due to a cha…

PED formula

%🔺QD / %🔺Price

Price elasticity of demand

Price elasticity of suppy

Between 0 and -1

1

Responsiveness of demand of a product following a change in i…

Relationship between the change in quantity supplied and a ch…

Price inelastic demand

Unitary price elasticity of demand

Price elasticity of demand

Responsiveness of demand of a product following a change in i…

Price elasticity of suppy

Relationship between the change in quantity supplied and a ch…

Cross-price elasticity (XED)

Substitute Goods (in XED)

Complementary Goods (in XED)

Income Elasticity (YED)

A measure of the consumer's responsiveness of one good to a c…

Positive XED value... - increase in price of one, leads to an in…

Negative XED value... - increase in price of one, leads to a dec…

A measure of responsiveness of the consumer's demand for a pa…

Cross-price elasticity (XED)

A measure of the consumer's responsiveness of one good to a c…

Substitute Goods (in XED)

Positive XED value... - increase in price of one, leads to an in…

Elasticity

Elastic

Inelastic

Price elasticity of demand (PED)... Cross…

The responsiveness of an economic variable, when another econ…

means that when the price goes up, consumers' buying habits d…

means that when the price goes up, consumers' buying habits s…

Types of elasticity

Elasticity

The responsiveness of an economic variable, when another econ…

Elastic

means that when the price goes up, consumers' buying habits d…

3.1 Price elasticity of demand

3.2 Cross-price elasticity of demand

3.3 Income elasticity of demand

3.3 Income elasticity demand

Measure of the responsiveness of the quantity of a good deman…

Measure of the responsiveness of demand for one good to a cha…

Measure of the responsiveness of demand to changes in income,…

A percentage increase in income produces a smaller percentage…

3.1 Price elasticity of demand

Measure of the responsiveness of the quantity of a good deman…

3.2 Cross-price elasticity of demand

Measure of the responsiveness of demand for one good to a cha…

PED

Negative

PED

Elastic

The responsiveness of demand to a change in price.

PED is always negative or positive

Percentage change in quality demanded/percentage change in pr…

Substitutes - if there are more substitutes demand becomes ...

PED

The responsiveness of demand to a change in price.

Negative

PED is always negative or positive

deadweight loss

What else does deadweight loss refer to?

Where is the deadweight loss on the gr…

elasticity

the total loss in consumer and producer surplus due to a chan…

excess burden

A measure of the response of one variable to a change in anot…

deadweight loss

the total loss in consumer and producer surplus due to a chan…

What else does deadweight loss refer to?

excess burden

Price elasticity of demand (PED) is a…

Since price and quantity demanded are…

On any downward-sloping demand curve,…

Number and closeness of substitutes... -T…

Explain the concept of price elasticity of demand, understand…

State that the PED value is treated as if it were positive, a…

Explain why PED varies along a straight line demand curve and…

Explain the determinants of PED including the number and clos…

Price elasticity of demand (PED) is a…

Explain the concept of price elasticity of demand, understand…

Since price and quantity demanded are…

State that the PED value is treated as if it were positive, a…

Microeconomics

Demand

Demand Schedule

Demand Curve

The behavior of individuals and firms in making decisions reg…

The quantity of a good or service consumers are willing able…

Lists the quantities demanded at each price

Shows the demand schedule plotted on a graph... Price=y-axis... Qua…

Microeconomics

The behavior of individuals and firms in making decisions reg…

Demand

The quantity of a good or service consumers are willing able…

Price Elasticity of Demand

% Change in Quantity Demanded (Without…

% Change in Price (No Midpoint Method)…

Price Elasticity of Demand (No Midpoin…

the ratio of the percent change in quantity demanded to the p…

= ( new QD - old QD / old QD ) * 100

= ( new P - old P / old P ) * 100 P is Price

= % change in quantity demanded / % change in price

Price Elasticity of Demand

the ratio of the percent change in quantity demanded to the p…

% Change in Quantity Demanded (Without…

= ( new QD - old QD / old QD ) * 100

Price Elasticity

MidPoint Formula - How to calculate th…

Price Elasticity of Demand Coefficients

Price Elasticity of Demand

Measures the responsiveness or sensitivity of consumers to a…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

Ed>, Ed< 1 and Ed = 1

Formula/Mathmatical Symbol: ... Elasticity = the percentage cha…

Price Elasticity

Measures the responsiveness or sensitivity of consumers to a…

MidPoint Formula - How to calculate th…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

Elasticity

Elasticity of Demand

Price Elasticity of Demand (PED)

Price Elastic Demand

a measure of responsiveness, specifically to a change in price.

a measure of how much the demand for a product changes when t…

the responsiveness of demand to a change in price.

a change in price causes a proportionately greater change in…

Elasticity

a measure of responsiveness, specifically to a change in price.

Elasticity of Demand

a measure of how much the demand for a product changes when t…

Price Elasticity of Demand

Elastic Demand

Inelastic Demand

Price Elasticity of Demand Midpoint Fo…

Measures buyers' responsiveness to price changes.... %Change in…

Sensitive to price change.... Large change in quantity

Insensitive to price change.... Small change in quantity.

This calculates the average elasticity over a range of price…

Price Elasticity of Demand

Measures buyers' responsiveness to price changes.... %Change in…

Elastic Demand

Sensitive to price change.... Large change in quantity

Elasticity

Price Elasticity of Demand

Price of Elasticity of Demand Equation

Perfectly Inelastic Demand

A general concept used to quantify the response in one variab…

The ratio of the percentage of change in quantity demanded to…

% change in quantity demanded / % change in price

Demand in which quantity demanded does not respond at all to…

Elasticity

A general concept used to quantify the response in one variab…

Price Elasticity of Demand

The ratio of the percentage of change in quantity demanded to…

Price Elasticity of Demand

% Change in Quantity Demanded (Without…

% Change in Price (No Midpoint Method)…

Price Elasticity of Demand (No Midpoin…

the ratio of the percent change in quantity demanded to the p…

= ( new QD - old QD / old QD ) * 100

= ( new P - old P / old P ) * 100 P is Price

= % change in quantity demanded / % change in price

Price Elasticity of Demand

the ratio of the percent change in quantity demanded to the p…

% Change in Quantity Demanded (Without…

= ( new QD - old QD / old QD ) * 100

Elasticity

Price of elasticity of demand

Income elasticity of demand

Price elasticity of demand

Measure of responsiveness to changes in price or income ... Con…

Measures responsiveness of quantity demanded to price... Connec…

Measure of responsiveness of demand to income... Connection: th…

the ratio of the percent change in the quantity demanded to t…

Elasticity

Measure of responsiveness to changes in price or income ... Con…

Price of elasticity of demand

Measures responsiveness of quantity demanded to price... Connec…

elasticity

price-elasticity coefficient and formula

midpoint formula

elastic

the buyers response to price change

percentage change in quantity of demanded of product x/ perce…

Ed = (Change in quanity/ [sum of quantities/2]) / (change in…

the buyer responds to price change

elasticity

the buyers response to price change

price-elasticity coefficient and formula

percentage change in quantity of demanded of product x/ perce…

price elasticity of demand

price-elasticity coefficient and formula

midpoint formula

elastic

the responsiveness or sensitivity of consumers to a price cha…

economists measure the degree to which deamnd is price elasti…

Ed = (Change in quanity/ [sum of quantities/2]) / (change in…

when demand is changed bby a specific percentage change in pr…

price elasticity of demand

the responsiveness or sensitivity of consumers to a price cha…

price-elasticity coefficient and formula

economists measure the degree to which deamnd is price elasti…

Elasticity

Price Elasticity of Demand

Determinants of the Elasticity of Demand

Total Revenue and Elasticity of Demand

How much one variable changes in response to another.

How much quantity demanded responds to a change in price.

1. Close substitutes- higher elasticity... 2. Narrowly defined g…

With inelastic demand, TR follows the price (i.e. price falls…

Elasticity

How much one variable changes in response to another.

Price Elasticity of Demand

How much quantity demanded responds to a change in price.

Elasticity

Price elasticity of demand

Perfectly inelastic demand

Perfectly elastic demand

A general concept used to quantify the response in one variab…

The ration of the percentage of change in quantity demanded t…

Demand in which quantity demanded does not respond at all to…

Demand in which quantity drops to zero at the slightest incre…

Elasticity

A general concept used to quantify the response in one variab…

Price elasticity of demand

The ration of the percentage of change in quantity demanded t…

Do you think the price elasticity of d…

Do you think the price elasticity of d…

Do you think the price elasticity of d…

Do you think the price elasticity of d…

The price elasticity of demand for Ford SUVs will decrease be…

The price elasticity of demand for Ford SUVs will increase be…

The price elasticity of demand for Ford SUVs will increase be…

Nothing

Do you think the price elasticity of d…

The price elasticity of demand for Ford SUVs will decrease be…

Do you think the price elasticity of d…

The price elasticity of demand for Ford SUVs will increase be…

Elasticity

Price Elasticity of Demand

perfectly inelastic demand

inelastic demand

A numerical measure of the responsiveness of quantity demande…

Measure of home much quantity demanded responds to a change i…

PED=0

PED<1

Elasticity

A numerical measure of the responsiveness of quantity demande…

Price Elasticity of Demand

Measure of home much quantity demanded responds to a change i…

Price Elasticity

MidPoint Formula - How to calculate th…

Price Elasticity of Demand Coefficients

Price Elasticity of Demand

Measures the responsiveness or sensitivity of consumers to a…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

Ed>, Ed< 1 and Ed = 1

Formula/Mathmatical Symbol: ... Elasticity = the percentage cha…

Price Elasticity

Measures the responsiveness or sensitivity of consumers to a…

MidPoint Formula - How to calculate th…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

price elasticity of demand

law of demand

elastic demand

inelastic demand

a measure of the responsiveness of consumer to a change in pr…

but how much will quantity demanded change with a change in p…

sensitive to price changes, large change in quantity

insensitive to price changes, small change in quantity

price elasticity of demand

a measure of the responsiveness of consumer to a change in pr…

law of demand

but how much will quantity demanded change with a change in p…

The price elasticity of demand is equa…

The price elasticity of demand is alwa…

The price elasticity of demand is alwa…

If the price elasticity of demand is e…

the percentage change in quantity demanded divided by the per…

as a unitless dimensionless number

a negative value

inelastic

The price elasticity of demand is equa…

the percentage change in quantity demanded divided by the per…

The price elasticity of demand is alwa…

as a unitless dimensionless number

Elasticity

Price elasticity of demand (PED)

Price elastic demand

Price inelastic demand

In general, this is a measure of the responsiveness or sensit…

Price elasticity of Demand (PED) is a measure of the responsi…

Relatively high responsiveness of demand to changes in price;…

Relatively low responsiveness of demand to changes in price;…

Elasticity

In general, this is a measure of the responsiveness or sensit…

Price elasticity of demand (PED)

Price elasticity of Demand (PED) is a measure of the responsi…

Complementary goods (complements)

Cross price elasticity of demand (XED)

Elastic demand (cross-price):

Elastic demand (income):

goods which are used together, such as DVD players and DVD di…

is a measure of responsiveness of the quantity demanded for a…

where a change in the price of one good will cause a proporti…

where a change in the income of consumers will cause a propor…

Complementary goods (complements)

goods which are used together, such as DVD players and DVD di…

Cross price elasticity of demand (XED)

is a measure of responsiveness of the quantity demanded for a…

Why do dealers make buyers haggle with…

Lorena likes to play golf. The number…

ADVANCED ANALYSIS Currently, at a pric…

What is the formula for measuring the…

Dealers make buyers haggle over the price of a car because th…

Using the data under D1 and D2, calculate the cross elasticit…

a. How many popsicles will be sold each day in the short run…

Percentage change in quantity supplied/Percentage change in p…

Why do dealers make buyers haggle with…

Dealers make buyers haggle over the price of a car because th…

Lorena likes to play golf. The number…

Using the data under D1 and D2, calculate the cross elasticit…

Elasticity

Change it causes on the graph: Price E…

Change it causes on the graph: Price E…

Change it causes on the graph: Income…

degree of responsiveness/sensitivity

movement along the curve

movement along the curve

shift along the curve

Elasticity

degree of responsiveness/sensitivity

Change it causes on the graph: Price E…

movement along the curve

What do economist mean by the term ela…

Whats the diffrence btwn elastic deman…

how would an perfectly inelastic deman…

how would an perfectly elastic demand…

responsiveness of consumers (and procedures) to a change in p…

elastic demand- very responsive consumers... inelastic demand- u…

would go up and down (north and south)

would go horizontally (east to west)

What do economist mean by the term ela…

responsiveness of consumers (and procedures) to a change in p…

Whats the diffrence btwn elastic deman…

elastic demand- very responsive consumers... inelastic demand- u…

Elasticity:

Price of Elasticity of Demand:

Determinants of Price Elasticity of De…

Determinants of Price Elasticity of De…

Measures how one variable responds to changes in another vari…

The sensitivity of quantity demanded to changes in price.... -Wh…

1. Necessities and luxuries... -toothpaste is a necessity... -Hair…

2. Substitues... -Fish VS chicken... -Pork VS beef... -Holiday VS bp…

Elasticity:

Measures how one variable responds to changes in another vari…

Price of Elasticity of Demand:

The sensitivity of quantity demanded to changes in price.... -Wh…

Price Elasticity

MidPoint Formula - How to calculate th…

Price Elasticity of Demand Coefficients

Price Elasticity of Demand

Measures the responsiveness or sensitivity of consumers to a…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

Ed>, Ed< 1 and Ed = 1

Formula/Mathmatical Symbol: ... Elasticity = the percentage cha…

Price Elasticity

Measures the responsiveness or sensitivity of consumers to a…

MidPoint Formula - How to calculate th…

MIDPOINT FORMULA... Q1 - Q0... (Q1+Q0)/2... ____________... P1-P0... (P1+P0…

Perfectly Inelastic

Perfectly Elastic

Two straight-line demand curves

Income Ilasticity

Regardless of price, quantity demanded is the same; i.e insulin

Because there are so many producers in the market, a slight i…

neither perfectly elastic nor perfectly inelastic.

When income rises, demand shifts out.

Perfectly Inelastic

Regardless of price, quantity demanded is the same; i.e insulin

Perfectly Elastic

Because there are so many producers in the market, a slight i…

Price elasticity of demand

Perfectly inelastic demand

Unity elastic demand

Inelastic demand

is a units free measure of the responsiveness of the quantity…

if quantity demanded remains constant when the prices changes…

If the percentage change in quantity demanded equals the perc…

the price elasticity of demand is between zero and 1

Price elasticity of demand

is a units free measure of the responsiveness of the quantity…

Perfectly inelastic demand

if quantity demanded remains constant when the prices changes…

Price elasticity of demand

Midpoint formula

Elastic

Inelastic

the responsiveness (or sensitivity) of consumers to a price c…

used for calculating elasticity

if demand is a specific percentage change in price results in…

if a specific percentage change in price produces a smaller p…

Price elasticity of demand

the responsiveness (or sensitivity) of consumers to a price c…

Midpoint formula

used for calculating elasticity

Price Elasticity of Demand

Midpoint Formula

Elastic Demand

Inelastic Demand

the responsiveness or sensitivity of consumers to a price ran…

this formula simply averages the two prices and the two quant…

if a specific percentage change in price results in a larger…

if a specific percentage change in price produces a smaller p…

Price Elasticity of Demand

the responsiveness or sensitivity of consumers to a price ran…

Midpoint Formula

this formula simply averages the two prices and the two quant…

Price Elasticity of Demand

Use percentages

Elastic Demand

Inelastic Demand

the responsiveness or sensitivity of consumers to a price cha…

choice of units, currency, compare changes of products in pri…

if a specific percentage change in price results in a larger…

percentage change in price produces a smaller percentage chan…

Price Elasticity of Demand

the responsiveness or sensitivity of consumers to a price cha…

Use percentages

choice of units, currency, compare changes of products in pri…

Cross price elasticity of demand

Elastic demand

Income elasticity of demand

Income elastic demand

A measure of the effect of the change in the price of one goo…

The case in which the price elasticity of demand is greater t…

The percent chaden in the quantity of a good demanded when a…

The case in which the income elasticity of demand for a good…

Cross price elasticity of demand

A measure of the effect of the change in the price of one goo…

Elastic demand

The case in which the price elasticity of demand is greater t…