Elasticity

Question 1

What is PED

Answer 1

Price elasticity of demand

Question 2

whats the PED equation

Answer 2

% change QD/% change price

Question 3

what are the elasticities with PED

Answer 3

• infinity perfectly elastic
  -1 unit elastic
  0 perfectly inelastic

Question 4

What are the factors that effect PED

Answer 4

• availability of substitutes

Question 5

what is PES

Answer 5

price elasticity of supply

Question 6

What is the PES equation

Answer 6

% change QS/% change P

Question 7

what are the elasticities of PES

Answer 7

0 - perfectly inelastic
1- unit elastic
infinity - perfectly elastic

Question 8

What factors effect PES

Answer 8

• Availability of substitutes
• availability to stockpile

Question 9

What is YED

Answer 9

income elasticity of demand

Question 10

what is the YED equation

Answer 10

% change QD / % change Y

Question 11

what is the elasticity of YED

Answer 11

• infinity - elastic
  -1-1 inelastic
  1- infinity - elastic

Question 12

YED goods

Answer 12

A normal good is a good with positive YED

An inferior good is a good with a negative YED

Question 13

what is XED

Answer 13

cross elasticity of demand

Question 14

what is the XED equation

Answer 14

% change QD of good B / % change of good A

Question 15

what are the elasticities for XED

Answer 15

less than 0 = compliments
more than 0 = substitutes

The bigger the number the more complimentary of substitute the goods are

Question 16

what are complimentary goods

Answer 16

goods or products that go well together

Question 17

substitutes

Answer 17

goods or services that are similar and can be swapped

Question 18

independant

Answer 18

neither substitutes or compliments

Question 19

what is consumer surplus

Answer 19

The amount a consumer is willing to pay compared to the amount they actually pay for the good/service

Question 20

producer surplus

Answer 20

the amount a producer is willing to accept for a good/service compared to how much they accept for a good/service

Question 21

where are consumer and producer surplus located on a supply demand disagram

Answer 21

consumer on top

producer below