4 Flashcards
1
Q
Formula for Calculating Income Elasticity of Demand (YED)
A
% change in quantity demanded / % change in income
2
Q
Advantages/ Disadvantages of PED
A
Adv - Allows the business to consider the impact on sales if it decides to change the price of a product.
Dis - Time Consuming, Ceteris Parabus (assumes all factors are constant)
3
Q
A Demand curve for product elasticity is usually ____?
A
Relatively Flat (due to large amount of substitutes)
4
Q
An elasticity X > 1 means it is
A
Elastic
5
Q
An Elasticity 0 > X < 1 means it is
A
Inelastic
6
Q
Give the Formula for Price Elasticity of Demand
A
% change in quantity demanded / % change in price
7
Q
Whereas it is _____ for Inelastic Products?
A
Relatively Steep
