Other elasticities of supply and demand, Microeconomics

Elasticities of supply and demand

  1. Other Demand Elasticities

          – Income elasticity of demand calculates the percentage change in quantity demanded resulting from a percent change              in income.

      2. The income elasticity of demand is:

1713_elasticity of demand and suppy.png

      3. Income Elasticity of Demand for: 

925_elasticity of demand and suppy1.png

– Superior goods 

– Normal goods 

– Inferior goods

      4. Other Demand Elasticities

– Cross elasticity of demand calculates the percentage variation in the quantity demanded of one good that comes out from a percent change in the price of the other good.

– For instance take the alternate goods, butter and margarine.

      5. The cross elasticity of demand is:

 

2456_elasticity of demand and suppy2.png

– Cross elasticity for substitutes is +ve

– Cross elasticity for complements is  -ve

Posted Date: 7/24/2012 8:49:17 AM | Location : United States







Related Discussions:- Other elasticities of supply and demand, Assignment Help, Ask Question on Other elasticities of supply and demand, Get Answer, Expert's Help, Other elasticities of supply and demand Discussions

Write discussion on Other elasticities of supply and demand
Your posts are moderated
Related Questions
meaning and characteristics of plural sense and singlural

1. Mrs Munyarryun, 67 years, has been retired from her work for two years. She rings for advice about urinary incontinence, a problem she has experienced over the last 6 months. Wh


"Cross-Correlations of output(t) with" "x(t-1)" [3,] "output" "0.3" [4,] "consumption" "0.1

What are the basic economic institutions? There are two fundamental economic institutions which have been so far used into the real world are as: a. Market economic institut

what is the theory of second best? prove the theorem with the help of a diagram.



Methodology of econometrics involving three stages 1. Specification of the model using a specific stochastic equation, together with a priori theoretical expectations about th

Analyze the sustainable approach to waste reduction developed by the company you selected. Include the following: Its products Previous methods of production The way it implemented