Name : Zalal Bakti

ID : 023202005014

Subject : Managerial Economic W-4

What I learn

Elasticity is a measurement of the degree of responsiveness of the dependent variable to

changes in any of the independent variables. The concept of price elasticity of demand is a
numerical measure of the extent to which quantity demanded responds to a change in price,
other determinants of demand being kept constant.

The income elasticity of demand is similar to the concept of price elasticity of demand. Just
as price determines price elasticity, so does income, another determinant of demand,
determine income elasticity. The income elasticity of demand is a numerical measure of the
degree to which quantity demanded responds to a change in income, other determinants of
demand being kept constant.

Price elasticity of supply is also dependent on many factors. Some of these factors are within
the control of the organization whereas others may be beyond their control. Regardless of the
control, if the management has knowledgePrice elasticity is used by economists to understand
how supply or demand changes given changes in price to understand the workings of the real
economy. For instance, some goods are very inelastic, that is, their prices do not change very
much given changes in supply or demand, for example people need to buy gasoline to get to
work or travel around the world, and so if oil prices rise, people will likely still buy just the
same amount of gas about these factors, it can manage its supply better.

 Price elasticity of demand is an economic measure of the change in the quantity

demanded or purchased of a product in relation to its price change
Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price
 The price elasticity of supply (PES) is the measure of the responsiveness in quantity
supplied (QS) to a change in price for a specific good (% Change QS / % Change in
Price). There are numerous factors that directly impact the elasticity of supply for a
good including stock, time period, availability of substitutes, and spare capacity. The
state of these factors for a particular good will determine if the price elasticity of
supply is elastic or inelastic in regards to a change in price.

The cross-price elasticity of demand measures the responsiveness of a good’s demand to

changes in the price of a second good. In managerial economics, this relationship is crucial
because the amount of your good customers purchase is influenced by the prices rival firms
charge for similar goods.
What I Can Implement at Company

with understanding, The income elasticity of demand To adjust the quantity of goods needed.
With limited income, the expenditure budget is of course also limited. The number of
requests for the goods needed has also decreased, which I can apply in the company when
doing material planning

Comments About the Session

Nice materials! I’ve got a new knowledge, detailed and well explaination