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7 Cards in this Set
- Front
- Back
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Price elasticity of demand
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a measure of the responsiveness of quantity demanded to change in price
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Elastic demand
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the percentage change in quantity demanded is greater than the percentage change in price. quantity demanded changes proportionately more than price changes
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Inelastic demand
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the percentage change in quantity demanded is less than the percentage change in price. quantity demanded changes proportionately less than price changes
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Unit elastic demand
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the percentage change in quantity demanded is equal to the percentage change in price. quantity demanded changes proportionately to price changes
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Perfectly elastic demand
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a small percnetage change in price causes an extremely large percentage change in quantity demanded (from buying all to buying nothing)
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Perfectly inelastic demand
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quantity demanded does not change as price changes
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Price elasticity of supply
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a measure of the responsiveness of quantity supplied to changes in price
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