Elasticity:
Elasticity is always a ratio between two percentage changes. For a general expression, y = f(x), the elasticity of y with respect to x is:
Note that the term ?y/?x shows the marginal effect, or slope of the function in the x-direction, and (y0, x0) is the starting point. For a linear function the slope is always constant, but the elasticity is not constant because it varies with the starting point.
Example:
As an example, consider the following demand function for beer:
QD = 100 − 2. p + 0.05. ps − 0.25 . pc − 0.00125 . Y
QD is here expressed in a volume measure (liters or bottles or cans etc) per month and prices and income in money (kr, €, $, £ etc). The substitute good maybe wine and the complement good sausage. If p = 10kr/bottle, ps = 50kr/bottle, pc = 30kr/kilo and Y = 20000kr/month. Inserting these numbers:
QD = 100 – 2 x 10 + 0.05 x 50 − 0.25 x 30 − 0.00125 x 20000 = 50,
i.e., this household, or consumer, demands 50liters of beer per month. Now, the demand curve is a graph which shows the relationship between the own price and quantity demanded, so if we aggregate all the numbers above except for the price we get:
Q = (100 + 0.05 x 50 − 0.25x 30 − 0.00125 x 20000) − 2 x pQ = 70 − 2. p
QD = 70 − 2. p
Given that the assumed value of the all other variables except the price. The marginal effect is −2, and if we start at the equilibrium we calculated initially,
i.e. p0 = 10, Q0 = 50, the price elasticity is,
This means that if the price changes by one percent, the quantity demanded changes by 0.4 percent. If the own price elasticity is less than 1 (after changing sign, since the marginal effect is always negative), we say that demand is inelastic.
Latest technology based Economics Online Tutoring Assistance
Tutors, at the www.tutorsglobe.com, take pledge to provide full satisfaction and assurance in Intermediate Microeconomics homework help via online tutoring. Students are getting 100% satisfaction by online tutors across the globe. Here you can get homework help for Intermediate Microeconomics, project ideas and tutorials. We provide email based Intermediate Microeconomics homework help. You can join us to ask queries 24x7 with live, experienced and qualified online tutors specialized in Intermediate Microeconomics. Through Online Tutoring, you would be able to complete your homework or assignments at your home. Tutors at the TutorsGlobe are committed to provide the best quality online tutoring assistance for Economics homework help and assignment help services. They use their experience, as they have solved thousands of the Economics assignments, which may help you to solve your complex issues of Intermediate Microeconomics. TutorsGlobe assure for the best quality compliance to your homework. Compromise with quality is not in our dictionary. If we feel that we are not able to provide the homework help as per the deadline or given instruction by the student, we refund the money of the student without any delay.
tutorsglobe.com pathogenicity and clinical manifestations assignment help-homework help by online leishmania tutors
Simple Harmonic Motion tutorial all along with the key concepts of Oscillations of a Spring-mass System, Differential equation of simple harmonic motion, Solution of differential equation for shm, Phase and Amplitude, Time Period and Frequency, Velocity and Acceleration
TutorsGlobe.com Free Energy and Spontaneous Reactions Assignment Help-Homework Help by Online Access Chemistry Tutors
tutorsglobe.com nature of coordination compounds assignment help-homework help by online types of salts tutors
Application of Genetics tutorial all along with the key concepts of principles of Heredity, heredity in Agriculture, Cross Fertilization, Self Fertilization, Sexual Reproduction, Asexual Reproduction, Genetics in Medicine, Genetics in Technology
encoder is a circuit that connect the human codes into machine code. decoder is a digital mixer kind of circuit. decoder converts the given digital code into essential corresponding number.
tutorsglobe.com weighted average cost of capital assignment help-homework help by online capital structure tutors
tutorsglobe.com commonly available medicinal plants assignment help-homework help by online medicinal plants including microbes tutors
tutorsglobe.com saprotrophs assignment help-homework help by online nutrition in fungi tutors
online dat exam preparation course and online dat tutoring package offered by TutorsGlobe are the most comprehensive and customized collection of study resources on the web, offering best collection of dat practice papers, quizzes, dat test papers, and guidance.
1. if rewinding is completed, make use of the presented winding wire gauge number for the new winding.
tutorsglobe.com sustainable scientific methods of farming assignment help-homework help by online sustained agriculture tutors
Carbanion-Aldol, Wittig Reaction and Claisen Condensation tutorial all along with the key concepts of Acidity of a-Hydrogen, Reactions Involving Carbanions, Halogenation of ketone, Nucleophilic addition to carbonyl compounds, Mechanism of Aldol condensation
Structural organization and function of protozoans tutorial all along with the key concepts of Nutrition in Protozoan Animals, Locomotion in protozoa, Osmoregulation and Excretion, Mechanisms for Response, Reproduction and life cycles and Encystment
A tangible non-current asset comprises both a physical life and an economic life. While a business disposes of a tangible non-current asset which may still be of value to others, some payment might be received.
1944049
Questions Asked
3689
Tutors
1482121
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!