Monday, January 23, 2017

January 11, 217


    • Elasticity of Demand - a measure of how customers react to a change in price 
    • Elastic Demand - demand that is very sensitive to a change in price; product is not a necessity; there are available substitutes
      • Greater than 1 (E > 1)
      • Examples: Steak, fur coats, soda
    • Inelastic Demand - demand that is not very sensitive to a change in; product is a necessity; there are few to no substitutes 
      • Less than 1 (E < 1)
      • Examples: Gas, insulin
    • Unitary Elastic 
      • E = 1
    • Calculations
      • S1: Quantity = New Quantity - Old Quantity / Old Quantity
      • S2: Price = New Price - Old Price / Old Price
      • S3: Price Elasticity = % Change in Q / Change in P
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1 comment:

  1. Maxwell A.January 24, 2017 at 2:34 AM

    While getting the information across, your blog, at the moment, seems a tad bland for my tastes. I like to see how one would personalize their blogs. By this I mean no offense, but otherwise a general good blog. 6.5/10

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