Notes for a freshmen college microeconomics course.
Title: Notes for a freshmen college microeconomics course.
Category: Science & Technology / Physics
Details: Words: 6890 | Pages: 29.3 (approximately 235 words/page)
Notes for a freshmen college microeconomics course.
CHAPTER 20
DEMAND AND SUPPLY ELASTICITY
I. Price Elasticity of Demand
A. Concept of Price Elasticity
The responsiveness or sensitivity of quantity
demanded to a change in price.
B. General Formula for Price Elasticity
Percentage change in quantity demanded
Percentage change in price
C. Mid-Points Formula
E/demand =
D. Interpreting the Elasticity Coefficient
A coefficient higher than 1 is elastic
" " lower " 1 is inelastic
" " exactly 1 is unitary
A negative coefficient implies that a lower
price results is lower …showed first 75 words of 6890 total…
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…showed last 75 words of 6890 total…and B which yield the same level of total
satisfaction to the consumer
V. Indifference Map = A series of indifference curves, each
showing a different level of total utility
VI. Consumer Optimum = The point where the highest
indifference curve is tangent to the budget line.
VII. Income-Consumption Curve = The line connecting
points of consumer optimum as income increases
VIII. Price-Consumption Curve = The line connecting
points of consumer optimum as the price of a good
changes
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