elasticity of demand - Hutchinson encyclopedia article about elasticity of demand Printer Friendly
Dictionary, Encyclopedia and Thesaurus - The Free Dictionary
1,517,894,009 visitors served.
forum mailing list For webmasters
?
New: Language forums
Dictionary/
thesaurus
Medical
dictionary
Legal
dictionary
Financial
dictionary
Acronyms
 
Idioms
Encyclopedia
Wikipedia
encyclopedia
?

elasticity of demand

   Also found in: Financial, Wikipedia 0.04 sec.

elasticity of demand

Measurement of the change in demand in response to a change in price, incomes, or other factor. Price elasticity, for example, is calculated by dividing the percentage change in price by the percentage change in demand.

A good where the price elasticity is greater than 1 is said to be price elastic – any chance in price will result in a relatively larger change in demand. Luxury goods usually fall into this category, for example a rise in the price of holidays will result in a fall in demand.

A good where the price elasticity is less than 1 is said to be price inelastic – any change in price will result in a relatively smaller change in demand. Essential goods usually fall into this category, for example a rise in the price of bread will result in a relatively smaller change in demand, and therefore an increase in revenue.



How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content.
?Page tools
Printer friendly
Cite / link
 Email
Feedback
?Sign in SSL protected
Email:
Password:
Register

? Mentioned in ? References in periodicals archive
 
Looking first at a ppm, equating MR and MC (second-order conditions are ignored) implies the firm sets a price that is a multiple of the MC of its optimal output; more specifically, the firm's optimal price is equal to the MC of its optimal output multiplied by an expression equal to: the absolute value of the price elasticity of demand at its optimal output divided by that absolute value minus 1.
Product and resource markets: points of symmetry by Weber, David W. / Academic Exchange Quarterly
Drugstores are selling needed staples, however, so they're less subject to the fickle whims of retail, unlike fashion and gift retailers that have a high elasticity of demand.
WALGREENS DRUGSTORES SPREADING IN SOUTHLAND by Daily News (Los Angeles, CA)
The 'AA-' rating reflects the economic strength and near monopoly position of the seven bridge system which provides critical transportation links in the San Francisco Bay Area, a mature and relatively stable traffic base, improved legal ratemaking flexibility, and demonstrated low to moderate elasticity of demand.
Fitch Rates Bay Area Toll Auth $1.16B 2006 Series F Revs 'AA-'; ... by Business Wire
More results
 
Hutchinson browser? ? Full browser
 
 
Hutchinson Encyclopedia
?

Disclaimer | Privacy policy | Feedback | Copyright © 2009 Farlex, Inc.
All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only. This information should not be considered complete, up to date, and is not intended to be used in place of a visit, consultation, or advice of a legal, medical, or any other professional. Terms of Use.