Ch.11- Price Elasticity of Demand Flashcards
1
Q
Price elasticity of demand (PED)
A
A measure of the responsiveness of the quantity demanded to a change in price
2
Q
Elastic demand
A
When the quantity demanded changes by a greater percentage than the change in price
3
Q
Inelastic demand
A
When the quantity demanded changes by a smaller percentage than the change in price
4
Q
Perfectly elastic demand
A
When a change in price causes a complete change in the quantity demanded
5
Q
Perfectly inelastic demand
A
When a change in price has no effect on the quantity demanded
6
Q
Unit elasticity of demand
A
When a change in price causes an equal change in the quantity demanded, leaving total revenue unchanged
