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Applied Economics - Chapter 4
Applied Economics - Chapter 4
You may have wondered why there are goods that you purchase more(less)
when price becomes less(more) while there are goods that even if price
become too high(low)still you purchase the same quantity of that good.
Demand elasticity
Is a measure of the degree of responsiveness of quantity demanded of a
product to a given change in one of the independent variables which affect
demand for that product.
Factors of demand elasticity
Price elasticity of demand
Income elasticity of demand
Cross price elasticity
Price Elasticity of Demand
Is the responsiveness of consumers’ demand to change in price of
the goods sold.