ECON Exam 2

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Anonymous
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128281
Filename:
ECON Exam 2
Updated:
2012-01-16 19:36:20
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microeconomics
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  1. price of elasticity of demand
    a measure of the responsiveness of the quantity demanded to changes in price
  2. elastic demand
    the price elasticity of demand is greater than one, so the percentage change in quantity exceeds the percentage change in price
  3. inelastic demand
    the price elasticity of demand is less than one so the percentage change in quantity equals the percentage change in price
  4. unit elastic demand
    the price elasticity of demand is one, so the percentage change in quantity equals the percentage change in price
  5. perfectly inelastic demand
    the price elasticity of demand is zero
  6. formula for the Price Elasticity of Demand (Ed)
    Ed= |% change in quantity demanded ÷ % change in price|
  7. total revenue
    the money a firm generates from selling its product
  8. income elasticity of demand
    a measure of the responsiveness of demand to changes in consumer income
  9. formula for Income Elasticity of Demand (Et)
    Et= % change in quantity demanded ÷ % change in income
  10. cross-price elasticity of demand
    a measure of the responsiveness of demand to changes in the price of another good
  11. formula for Cross-Price Elasticity of Demand (Exy)
    Exy= % change in quanitity of X demanded ÷ % change in price Y
  12. price elasticity of supply
    a measure of the responsiveness of the quantity supplied to changes in price
  13. formula for Price Elasticity of Supply (Es)
    Es= % change in quantitiy supplied ÷ % change in price
  14. perfectly inelastic supply
    the price elasticity of supply equals 0
  15. perfectly elastic supply
    the price elasticity of supply is equal to ∞

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