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Elasticity
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a numerical measure of the responsiveness of the quantity demanded or the quantity supplied to one of its determinants
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Price elasticity of demand
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measure of how much the quantity demanded responds to a change in price
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Midpoint method
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method by which we can calculate the percent change of the quantity demanded or supplied
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Ed
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Percent change in the quantity demanded divided by the percent change in the price
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Perfectly inelastic demand
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elasticity of demand is 0, vertical graph
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Inelastic demand
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elasticity of demand is less than 1, relatively steep graph
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Unit elastic demand
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elasticity of demand is 1, intermediate slope
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Elastic demand
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elasticity of demand is greater than 1, relatively flat slope
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Perfectly elastic demand
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elasticity of demand is infinity, horizontal line
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Price elasticity of supply
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the measure of how much the quantity supplied responds to a change in price
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Es
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percent change in quantity supplied divided by the percent change in price
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Perfectly inelastic supply
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elasticity of supply is 0, vertical line
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Inelastic supply
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elasticity of supply is less than 1 , relatively steep slope
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Unit elastic supply
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elasticity of supply is 1, intermediate slope
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Elastic supply
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elasticity of supply is greater than 1, relatively flat slope
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Perfectly elastic supply
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elasticity of supply is infinity, horizontal line
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Income elasticity of demand
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measures the response of the quantity demanded to a change in consumer income
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Income Ed
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percent change in quantity demanded divided by percent change in income
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Cross price elasticity of demand
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measures the response of demand for one good to changes in the price of another good
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Cross Ed
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percent change of quantity demanded of 1 good divided by percent change in quantity demanded of another good
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