Menu_09_Feb_11

Menu_09_Feb_11 - TODAYS MENU: Wednesday 09 February 2011 I....

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TODAY’S MENU: Wednesday 09 February 2011 I. BUSINESS A . Practice Problems 1. Chapter 7: 1-4, 7, 8, 11-17, 20, 24, 25 B. First Exam: Next time II. SUBSTANCE A. Elasticity -responsiveness, responsibility (want to know how people respond) -behavior of people (buyers and sellers) -how do they respond to. . 1. Price elasticity of demand a. Definition -how buyers change in change in price b. Measure (how responsive people are to a change in the price) i. Elastic >1 -SENSITIVE to change -how many options you have (certain gas station in certain location ii. Inelastic <1 -insensitive -gas prices in U.S.—not many options iii. Unit elastic =1 -proportionally c. Determinants (options in other views given) -how sensitive people are i. Number and availability of substitutes -greater availability; more SENSITIVE -more choices (can buy somewhere else) -take it or leave it -competition? Advertisements—perceive that we need make you self-conscious ii. Necessity or luxury -physiological or physiological -everything else held constant the more price
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This note was uploaded on 02/14/2012 for the course ECON 2030 taught by Professor Bong during the Fall '07 term at LSU.

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Menu_09_Feb_11 - TODAYS MENU: Wednesday 09 February 2011 I....

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