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Unformatted text preview: -it ewuals the percent change in quantity demanded in response to 1% change in price-negative price elasticity is consistend with law of demand-price elasticity varies by where you are (P,Q) on the demand curve-E=(change in Q)/(change in P) x (P/Q)-Qd=a-bP-demand in called inelastic if -1 is less than or equal to E which is less than 0-in percentage terms, quantity changes less than price-demand is called perfectly inelastic if E=0-demand is called elastic if E < -1-in ercentage terms, quantity changes more than price-demand is called perfectly elastic if E = - infinity-in percentage terms, quantity changes exactly as much as price-price high, quantity low, relatively inelastic...
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This note was uploaded on 11/27/2008 for the course PAM 2000 taught by Professor Evans,t. during the Fall '07 term at Cornell University (Engineering School).
- Fall '07