Price Elasticity Of Demand (Week 4) Flashcards
1
Q
How do you calculate PED
A
% change in quantity demanded / % change in price
2
Q
What is it when the PED is valued infinity
A
Perfectly elastic
3
Q
What is it when the PED is valued 1 - infinity
A
Relatively elastic
4
Q
What is it when the PED is valued 1
A
Unitary elasticity
5
Q
What is it when the PED is valued 0-1
A
Relatively inelastic
6
Q
What is it when the PED is valued 0
A
Perfectly inelastic
7
Q
Can PED be calculated off the graph gradient
A
No, it shows the % change not the actual change
8
Q
What does PED measure
A
The proportional responsiveness of quantity demanded following a change in price
