ECON 1B03 Lecture Notes - Lecture 4: Hyperbola, Demand Curve, Substitute Good
Shanghaibalcony1234 and 37744 others unlocked
46
ECON 1B03 Full Course Notes
Verified Note
46 documents
Document Summary
Measures how responsive qd or qs is to changes in price or other determinants. Total revenue (tr: price x quantity traded, tr = p x q. Types of price elasticity of demand: inelastic demand. Change in p leads to a proportionately smaller change in qd. Demand is not very responsive to a price change. Percentage change in p > percentage change in. Change in p doesn"t change qd at all. % change in p = 0 change in qd. Change in p leads to a proportionately bigger change in qd. Demand is very responsive to change in p. % change in qd > % change in p. Change in p leads to an infinitely great change in. Demand is extremely responsive to a price change. No real world example, but something with an infinite number of substitutes so that any change in price would create an infinite change in demand: unit elastic.