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cross-price elasticity of demand
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income elasticity of demand
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cross-price elasticity of demand The percentage change in the demand of one good divided by the percentage change in the price of another good; it’s positive for substitutes, negative for complements, and zero for unrelated goods
income elasticity of demand The percentage change in demand divided by the percentage change in consumer income; the value is positive for normal goods and negative for inferior goods
unit-elastic supply curve A percentage change in price causes an identical percentage change in quantity supplied; depicted by a supply curve that is a straight line from the origin; the elasticity value equals 1.0
inelastic supply A price change has relatively little effect on quantity supplied; the percentage change in quantity supplied is less than the percentage change in price; the price elasticity of supply is less than 1.0
unit-elastic supply The percentage change in quantity supplied equals the percentage change in price; the price elasticity of supply equals 1.0
elastic supply A price change has a relatively large effect on quantity supplied; the percentage change in quantity supplied exceeds the percentage change in price; the price elasticity of supply exceeds 1.0
perfectly elastic supply curve A horizontal line, which means that any price decrease drops the quantity supplied to zero; the elasticity value is infinity
perfectly inelastic supply curve A vertical line, which means that a price change has no effect on the quantity supplied; the elasticity value is zero
price elasticity of supply Measures the responsiveness of quantity supplied to a price change; the percentage change in quantity supplied divided by the percentage change in price
perfectly inelastic demand curve vertical line, which means that any price change has no effect on the quantity demanded; the elasticity value is zero
unit-elastic demand curve Everywhere along the demand curve, the percentage change in price causes an equal but offsetting percentage change in quantity demanded, so total revenue is unchanged; the elasticity has an absolute value of 1.0
constant-elasticity demand curve The type of demand that exists when price elasticity is the same everywhere along the curve; the elasticity value is unchanged
perfectly elastic demand curve A horizontal line, which means that any price increase would reduce quantity demanded to zero; the elasticity has an absolute value of infinity
price elasticity of demand Measures how responsive quantity demanded is to a price change; the percentage change in quantity demanded divided by the percentage change in price
inelastic demand A change in price has relatively little effect on quantity demanded; the percentage change in quantity demanded is less than the percentage change in price; the resulting price elasticity has an absolute value less than 1.0
unit-elastic demand The percentage change in quantity demanded equals the percentage change in price; the resulting price elasticity has an absolute value of 1.0
elastic demand A change in price has a relatively large effect on quantity demanded; the percentage change in quantity demanded exceeds the percentage change in price; the resulting price elasticity has an absolute value exceeding 1.0
total revenue Price multiplied by quantity demanded at that price
linear demand curve A straight-line demand curve; such a demand curve has a constant slope but usually has a varying price elasticity
Created by: user-1794339
 

 



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