Chapter 5 - Elasticity and its Application

Time horizons

________ have less of elastic demand than goods.

Slope

________: ratio of changes in the two variables; Elasticity: ratio of percentage changes in the two variables.

midpoint method

The ________ helps to better calculate elasticities.

Goods

________ with close substitutes are often more elastic in demand.

Total revenue

________ is often used when studying the changes in supply or demand in markets.

percentage change

The ________ in price is positive, while the ________ in the demanded quantity is negative.

denominator

The ________ is the percentage change in price when using the midpoint method.

numerator

The ________ is the percentage change in quantity when using the midpoint method.

Demand

________ is often elastic if the ________ in quantity substantially changes in the price.

Price elasticity of supply

________= percentage change in quantity supplied /percentage change in price.