Other elasticities of supply and demand, Microeconomics

Assignment Help:

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


Related Discussions:- Other elasticities of supply and demand

Utility, Lakshani has $5 to spend on pens and pencils. Each pen costs $0.50...

Lakshani has $5 to spend on pens and pencils. Each pen costs $0.50 and each pencil costs $0.10. She is thinking about buying 6 pens and 20 pencils. The last pen would add five time

Policies of educational financing - earmarking, Policies of Educational Fin...

Policies of Educational Financing - Earmarking Earmarking refers to setting aside and using the funds generated by a special cess/tax for the particular purpose for which it i

Oligopoly, what are the factors causing oligopoly market?

what are the factors causing oligopoly market?

What do you mean by average product, Average product of a factor is the tot...

Average product of a factor is the total output produced per unit of the factor employed thus, Average product = total product / number of units of factor employed If Q stand

Trading/ keynesian economics and supply side economists, 1) Describe (with ...

1) Describe (with an example) how trading can lead to an increase in world output if countries specialize in the good in which they have a comparative advantage. How does the intr

Crop patterns, CROP PATTERNS: Analysis of crop patterns in India shoul...

CROP PATTERNS: Analysis of crop patterns in India should relate to the following aspects:  a) The relative significance of different crops/crop groups in the overall area u

Marinal utility by marhalls , a project report on marshalls marginal utilit...

a project report on marshalls marginal utility analysis

Pp curve, how does pp curve solve the problem of how to produce, what yo pr...

how does pp curve solve the problem of how to produce, what yo produce, and when to produce?

Market supply of labour, use a graphical illustration to describe briefly w...

use a graphical illustration to describe briefly what the influence of each of the following would be on the market supply of labour on an increase in immigration..

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd