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Econ 100 > Chapter 5 > Flashcards

Chapter 5 Flashcards

1
Q

Constant Unitary Elasticity

A

When given percent price change in price leads to an equal percentage change in quantity demanded/supplied

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2
Q

Cross-price elasticity of demand

A

The percentage change in quantity of Good A that is demanded as a result of a percentage change in Good B

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3
Q

Elastic Demand

A

When the elasticity of demand is greater than one, indicating a high responsiveness of quantity demanded/supplied to changes in price

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4
Q

Elastic Supply

A

When the elasticity of either supply is greater than one, indicating a high responsiveness of quantity demanded/supplied to changes in price

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5
Q

Elasticity

A

An economics concept that measures responsiveness of one variable to changes in another variable

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6
Q

Elasticity of savings

A

The percentage change in the quantity of savings divided by the percentage change in interest rates

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7
Q

Inelastic demand

A

When elasticity of demand is less than one, indicating that one percent increase in price paid by the consumer leads to less than one percent change in purchases(vice versa) ; indicates a low responsiveness by consumers to price changes

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8
Q

Inelastic supply

A

When elasticity of supply is less than one, indicating that a one percent increase in price paid to the firm will result in a less than one percent increase in production(vice versa) ; indicates a low responsiveness of the firm to price increases(vice versa if price drops)

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9
Q

Infinite elasticity/perfect elasticity

A

The extremely elastic situation of demand/ supply where the quantity changes by an infinite amount in response to any change in price; horizontal in appearance

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10
Q

Price elasticity

A

The relationship between the percent change in price resulting in a corresponding percent change in quantity demanded/ supplied

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11
Q

Price elasticity of demand

A

Percentage change in quantity demanded of a good/ service divided by the percentage change in price

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12
Q

Price elasticity of supply

A

Percentage change in quantity supplied divided by percentage change in price

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13
Q

Tax incidence

A

Manner in which tax burden is divided between buyers and sellers

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14
Q

Unitary elasticity

A

When the calculated elasticity is equal to one indicating that a change in the price of a good/service results in a proportional change in quantity demanded/ supplied

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15
Q

Wage elasticity of labor supply

A

Percentage change in hours worked divided by the percentage change in wages

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16
Q

Zero inelasticity/perfect inelasticity

A

The hourly inelastic case of demand/supply in which a percent change in price(no matter how large) results in zero change in quantity; vertical in appearance

Econ 100 (15 decks)

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