Chp 5 Elasticity Flashcards
1
Q
What is the definition of cross price elasticity of demand
A
A measure of how much the quantity demanded of one good response to a change in the price of another good, computed as the percentage change in quantity demanded of the first good divided by the percentage change in the price of the second good.
2
Q
What are the other demand elasticity’s
A
- The income elasticity of demand
2. The cross price elasticity of demand
3
Q
What is the definition of income elasticity of demand
A
A measure of how much the quantity demanded of a good response to a change in consumers income, computed as the percentage change in quantity demanded divided by the percentage change in income.
