Term
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Definition
| A measure of responsiveness to changes in prices or income. |
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Term
| The importance of the Price Elasticity of Demand is: |
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Definition
| The measure of the responsiveness of DEMAND to income. |
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Term
| The significance of the Price Elasticity of Supply is a measure of: |
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Definition
| The responsiveness of the quantity supplied to price. |
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Term
| Income Elasticity of Demand is: |
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Definition
| A measure of the responsiveness of demand to income. |
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Term
| The Price Elasticity of Supply measures: |
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Definition
| The responsiveness of the quantity supplied to price. |
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Term
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Definition
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Term
| The Price Elasticity of Demand is the ratio of the: |
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Definition
| Percentage in the quantity demanded to the percent change in the price (as we move along the demand curve). |
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Term
| The midpoint method is a technique for calculating: |
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Definition
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Term
| The Price Elasticity of demand is equal to the percent change in the quantity demanded divided by: |
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Definition
| The percent change in the price as you move along the demand curve. |
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Term
| PErcent changes are best measured using the _________ method. |
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Definition
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Term
| The midpoint (method) is calculated by: |
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Definition
| Quantity demanded divided by the percent change in the price. |
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Term
| Demand is Perfectly ELASTIC when: |
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Definition
| Any price increase will cause the quantity demanded to drop to zero. |
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Term
| When demand is perfectly inelastic, the demand curve is a _________ line. |
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Definition
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Term
| Demand is Perfectly ELASTIC when any price increase will cause the: |
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Definition
| Quantity demanded to drop to zero. |
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Term
| When demand is perfectly ELASTIC, the demand curve is a ____________ line. |
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Definition
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Term
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Definition
| The price elasticity of demand is GREATER than 1. A fall in price increases total revenue. |
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Term
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Definition
| The price elasticity of demand is less than 1. A fall in price reduces total revenue. |
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Term
| Demand is unit-elastic if: |
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Definition
| The price elasticity of demans is exactly 1. A fall in price has no effect on total revenue. |
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Term
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Definition
| The total value of sales of a good or service. |
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Term
| Total revenue is equal to: |
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Definition
| The price multiplied by the quantity sold. |
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Term
| When a seller raises the price of a good, two countervailing effects are present: |
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Definition
| Price and Quantity Effect. |
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Term
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Definition
| After a price increase, each unit solf sells at a higher price, which tends to raise revenue. |
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Term
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Definition
| After a price increase, fewer units are sold, which tends to LOWER revenue. |
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