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    This document defines and discusses four types of elasticity: price elasticity of demand, income elasticity of demand, cross-price elasticity of demand, and price elasticity of supply. It then focuses on price elasticity of demand, explaining that it measures the responsiveness of quantity demanded to a change in price. There are five types of price elasticity of demand ranging from perfectly elastic to perfectly inelastic.

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    This document defines and discusses four types of elasticity: price elasticity of demand, income elasticity of demand, cross-price elasticity of demand, and price elasticity of supply. It then focuses on price elasticity of demand, explaining that it measures the responsiveness of quantity demanded to a change in price. There are five types of price elasticity of demand ranging from perfectly elastic to perfectly inelastic.

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    26 views1 page

    Elasticity

    Uploaded by

    josbgs
    This document defines and discusses four types of elasticity: price elasticity of demand, income elasticity of demand, cross-price elasticity of demand, and price elasticity of supply. It then focuses on price elasticity of demand, explaining that it measures the responsiveness of quantity demanded to a change in price. There are five types of price elasticity of demand ranging from perfectly elastic to perfectly inelastic.

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    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
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    of 1

    7/10/09

    Elasticity

    Elasticity: a measure of responsiveness of a change in one variable due to a change in another

    1. Price Elasticity of Demand (PED)


    2. Income Elasticity of Demand (YED)
    3. Cross – price Elasticity of Demand (XES)
    4. Price Elasticity of Supply (PES)

    Price Elasticity of Demand

    P.E.D. - am measure of responses of a percentage change in QD due to a percentage change in price.

    5 different types
    Excise Tax – a tax to goods produced domesticity.
    1. Perfectly elastic - infinite Tariff – tax on imports.
    2. Elastic – infinite >PED > 1
    3. Unit elastic - 1
    4. Inelastic 0 < PED <1
    5. Perfectly inelastic - 0

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