1.2 Flashcards
1
Q
Demand
A
quantity of products brought at a given price over a period of time
2
Q
revenue
A
selling price x quantity
3
Q
7 factors that effect demand
A
- price of competition
- income
- seasonality
- demographics
- change in legislation
- change in trends
- adverting
4
Q
supply
A
the quantity of products supplied at a given price over a given period of time
5
Q
6 non-price factor that effect supply
A
- change n cost of production
- new technology
- external shocks
- subside
- indirect taxes
- weather conditions
6
Q
PED
A
measures the relationship between the change in quantity demanded and change in price
7
Q
PED
A
= %change in QD / %change in P
8
Q
3 factors that effect PED
A
- product differentiation
- number of substitutes
- brand loyalty
9
Q
YED
A
measures the relationship between the change in quantity demanded and change in income
10
Q
YED
A
= %change in QD / %change in income
11
Q
if YED is + or - it means
A
+ normal
- inferior
12
Q
if yed is +>1 or +<1
A
<1 inelastic
>1 elastic
