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Cross-price elasticity of demand
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The percentage change in quantity demanded of one good divided by the percentage change in the price of another good.
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Elastic demand
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The case where the percentage change in the quantity demanded is greater than the percentage change in price, so the price elasticity is greater than 1 in absolute value.
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Elasticity
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A measure of how much one economic variable responds to changes in another economic variable.
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Income elasticity of demand
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A measure of the responsiveness of the quantity demanded to changes in income, measured by the percentage change in quantity demanded divided by the percentage change in income.
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Inelastic demand
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The case where the percentage change in quantity demanded is less than the percentage change in price, so the price elasticity is less than 1 in absolute value.
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Perfectly elastic demand
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The case where the quantity demanded is infinitely responsive to price and the price elasticity of demand equals infinity.
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Perfectly inelastic demand
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The case where the quantity demanded is completely unresponsive to price and the price elasticity of demand equals zero.
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Price elasticity of demand
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The responsiveness of the quantity demanded to a change in price, measured by dividing the percentage change in the quantity demanded of a product by the percentage change in the product's price.
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Price elasticity of supply
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The responsiveness of the quantity supplied to a change in price, measured by dividing the percentage change in the quantity supplied of a product by the percentage change in the product's price.
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Total revenue
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The total amount of funds a seller receives from selling of a good or service, calculated by multiplying price per unit by the number of units sold.
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Unit-elastic demand
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The case where the percentage change in quantity demanded is equal to the percentage change in price, so the price elasticity is equal to 1 in absolute value.
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Midpoint Formula for Calculating Percent Change
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A method of calculating any percent change by taking the difference in the two values and dividing by the average of the two values.
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