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Unformatted text preview: OT use negative numbers.
3. Fill in the Original numbers first (Qd,P)
4. Fill in the other two numbers Inelastic vs Elastic 21:15 5. Know the answer Ed> 1 Elastic, Ed<1 Inelastic Marginal Revenue is the change in total revenue divded by the change in quantity
MR= ΔTR/ΔQ Cross elasticity of demand
Ec= the percentage change in quantity demanded of product B divided by the percentage change in price of product A
Ec=%Δ in Qd of b/ %Δ in P of a
Ec= Δ in Qd of b/ Qd of b x P of a/ Δ in P of a
You can use negative numbers
Ec>0 substitutes, Ec<0 complement Income elasticity of Demand
Ey the percentage change in quantity demanded divided by the percentage change in income
Ey= %Δ in Qd/ % Δ in Y
Ey= Δ in Qd/ Qd x Y/Δ in Y
You can use...
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