Elasticity refers to the degree of responsiveness in supply or demand in relation to changes in pric

Elasticity refers to the degree of responsiveness in supply or demand in relation to changes in pric

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Elasticity refers to the degree of responsiveness in supply or demand in relation to  changes in price. If a curve is more elastic, then small changes in price will cause large  changes in quantity consumed. If a curve is less elastic, then it will take large changes  in price to effect a change in quantity consumed. Graphically, elasticity can be  represented by the appearance of the supply or demand curve. A more elastic curve will  be horizontal, and a less elastic curve will tilt more vertically. When talking about  elasticity, the term "flat" refers to curves that are horizontal; a "flatter" elastic curve is  closer to perfectly horizontal.  At the extremes, a perfectly elastic curve will be horizontal, and a perfectly inelastic  curve will be vertical. Hint: You can use perfectly inelastic and perfectly elastic curves to  help you remember what inelastic and elastic curves look like: an 
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This note was uploaded on 12/13/2011 for the course ECO 1320 taught by Professor Staff during the Fall '11 term at Texas State.

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