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Lecture9--MOREONELASTICITY

Lecture9--MOREONELASTICITY - aretakingattendance...

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Reminders: Please sit in your assigned seats -- we  are taking attendance Examination 1:  Monday, September 29,  bring a #2 pencil.  Coverage, Chapts. 1- 6 No makeup exams without a valid  excuse.  Makeup exams allowed only  within 1 week of the date of an  examination (see syllabus)
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More on Elasticity 1. Price Elasticity of Supply 2.  Using Elasticity to forecast the  effects of taxes on prices
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Price Elasticity of Supply Measures the sensitivity of changes in  quantity supplied to changes in price  of a good or service Price elasticity of supply is a positive  number that can range from zero to  infinity E S = Percentage change in quantity supplied Percentage change in price
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Examples:   A 10 percent  increase in the price  of steel causes a 15  percent increase in  the quantity supplied The price elasticity  of supply for steel is  15%/10% = 1.5 
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