Economics > STUDY GUIDE > Columbus State Community College MICRO ECONOMICS 2200Micro Unit 2 Study Guide Assignment (All)

Columbus State Community College MICRO ECONOMICS 2200Micro Unit 2 Study Guide Assignment

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Unit Study 2 Guide Assignment Try to complete this study guide as you work your way through this unit. This study guide is due at the time Unit 2 Test is due. Please keep this document in rich text ... format (RTF), so that it will work on Macs and PCs. Chapter 5 Elasticity Define the following terms: Price elasticity of demand: percentage change in the quantity demanded of a good or service divided the percentage change in price Price elasticity of supply: percentage change in the quantity supplied divided by the percentage change in price Cross-price elasticity of demand: the percentage change in the quantity of good A that is demanded as a result of a percentage change in good B Explain the following: Explain the difference in elastic demand vs inelastic demand: Elastic demand is when the elasticity of demand is greater than one, indicating a high responsiveness of quantity demanded or supplied to changes in price. Inelastic demand is when the elasticity of demand is less than one, indicating that a 1 percent increase in price paid by the consumer leads to less than a 1 percent change in purchases (and vice versa); this indicates a low responsiveness by consumers to price changes What effect does time have on EoD and EoS? Time has a lasting effect on EoD and EoS by allowing the percentage to decrease [Show More]

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