Elasticity Summary - Microeconomics101 - Notion-Based Study Notes
5 views 0 purchase
Course
Microeconomics101
Institution
Université Hassan 2
Book
Microeconomics
This detailed guide on Elasticity in Microeconomics is neatly organized in Notion. Covering elasticity of demand, supply, and cross-price elasticity, it also explores short vs long-run elasticity. The well-organized format in Notion makes it easy to track progress and revisit key concepts.
Demand Summary - Microeconomics101 - Comprehensive Notes Made in Notion
Elasticity in Microeconomics101 – Book-Based Study Notes Organized in Notion
All for this textbook (5)
Written for
Université Hassan 2
Microeconomics101
All documents for this subject (5)
Seller
Follow
anonymouszi
Content preview
🖊️
Elasticity:
1. elasticity shows how much more or less people will buy or producers will
sell when the price or other factors change.
2. elastic vs inelastic:
when a good is considered elastic, it means that the percentage
change in quantity demanded or supplied is relatively greater than the
percentage change in price.
inelasticity implies that the quantity demanded or supplied is not very
responsive to changes in price. The percentage change in quantity is
relatively smaller than the percentage change in price.
😊 this elasticity equation is for both supply and demand.
The price elasticity of demand (represented by ε, the Greek letter epsilon).
The price elasticity of supply (η, the Greek letter eta).
The elasticity of demand concisely answers the question “How much does
the quantity demanded of a product fall in response to a 1% increase in its
price?”
how responsive the quantity supplied of a product is to price changes?
Elasticity: 1
, as the value gets closer to 0, the elasticity becomes lower.
the elasticity changes along the demand/supply curve.
how to calculate the percent change:
percentage change= (new value-initial value/initial value)
×100 If the result is
positive, it indicates an increase, and if it's negative, it
indicates a decrease.
example:
if the initial value of a quantity is $50, and it increases to $60,
the percentage change would be calculated as follows:
percentagechange =(60 − 50/50) × 100 = 20%
so the quantity has increased by 20%
🔒 the elasticity of demand coefficient is the % change in Q divided by
the % change in P. % change in Q/% change in P
calculate the price elasticity of demand/supply (PED&PES):
1. the PED (ε) and PES (η) are:
the percentage change that will occur in the quantity demanded or supplied
in response to a 1% change in price.
Elasticity: 2
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller anonymouszi. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.79. You're not tied to anything after your purchase.
