elasticity

Question 1

5 factors that causes changes in the elasticity of demand

Answer 1

Substitute availability
degree of necessity
brand loyalty
information availability
addictiveness and habits

Question 2

5 factors that causes changes in the elasticity of supply

Answer 2

Time Period: Supply is generally more elastic in the long run as producers have more time to adjust their output.

Availability of Inputs: When production resources are readily available, supply can easily respond to price changes, making it more elastic.

Number of producers: More suppliers in a market make supply more elastic by enabling quicker responses to price changes, while fewer suppliers result in inelastic supply.

Mobility of Factors of Production: The easier it is to move labor and capital into production, the more elastic the supply will be.

Nature of the Good: Products that are perishable or have fixed production times typically have more inelastic supply compared to those that can be produced quickly.

Question 3

The further from 0= more _____
closer to 0= More _____

Get information by _______

Answer 3

elastic
inelastic

observing

Question 4

When the response is GREAT _________
when the response is NOT GREAT _______

Answer 4

Elastic
inelastic

Question 5

Perfect elasticity

Answer 5

PED= infinite
(the more horizontal the more elastic) +

Question 6

Elastic

Answer 6

PED>1

Question 7

Unitary elastic

Answer 7

PED=1

Question 8

inelastic

Answer 8

PED<1

Question 9

Perfectly inelastic

Answer 9

PED=0