PSU Econ 102 Exam 2 Questions and Correct Answers the Latest Update and Recommended Version
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Course
PSU Econ 102
Institution
PSU Econ 102
Elasticity
→ Measure of the responsiveness of buyers and sellers to changes in price or income
Price Elasticity of Demand
→ How quantity demanded responds to a price change
Price Elasticity of Supply
→ How quantity supplied responds to a price change
Income Elasticity of Demand
→ How...
→ Amount of money a seller receives from selling their products
→ TR = P x Q
→ -Elastic (lowering price will increase revenue)
→ -Inelastic (raising price will increase revenue)
Elasticity and Taxes
→ Elastic - seller bears more of tax burden (higher DWL)
→ Inelastic - buyer bears more of tax burden (lower DWL)
Government Revenue
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