NYU Markets Exam 1 Questions & Answers 2024/2025
Demand Curve - ANSWERSa graph of the relationship between the price of a good and the quantity demanded (HOLDING ALL ELSE FIXED where only variable that change are P and Q which is stated by Law of Demand
Movements of the demand curve - ANSWE...
Demand Curve - ANSWERSa graph of the relationship between the price of a good and the quantity
demanded (HOLDING ALL ELSE FIXED where only variable that change are P and Q which is stated by Law
of Demand
Movements of the demand curve - ANSWERSalong a demand curve are a response to price changes for
that good
Shift in demand curve - ANSWERSmovement of a demand curve right or left resulting from a change in
one of the determinants of demand other than the price of the good( substitutes or complements things
like that)
elasticity of demand - ANSWERSconsumers' responsiveness or sensitivity to changes in price (% change
in Q divided by % change in P) and will always be negative
Laws of Elasticity - ANSWERSelasticity is negative
elasticy changes at dif pts of the demand curve
Z is not the same as the slope of the demand curve
Flatter a demand curve the more price sensitive the users and the higher the elasticity. Str8 line demand
curve still has different elasticity at every point
Elasticity uses - ANSWERSElasticies can be used for predictive or prescriptive purposes. Ex want a desired
5% change in price and you have the elasticity you can calculate the change in Q that would be needed
to achieve that 5% change in P
1) if good is inelastice Q won't change and therefore revenues will go up
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