- 3.1 Demand LO 1, 2
- 3.2 Supply LO 3, 4
- 3.3 The Determination of Price LO 5
H. Key Concepts
I. Study Exercises - Fill-in-the-Blank
- Review
- Problems
- 4 Elasticity
A. Chapter Outline
B. Learning Objectives (LO)
C. 4.1 Price Elasticity of Demand - The Measurement of Price Elasticity
a. The Use of Average Price and Quantity in Computing Elasticity
b. Interpreting Numerical Elasticities - What Determines Elasticity of Demand?
a. Availability of Substitutes
b. Importance of the Product in Consumers’ Budgets
c. Short Run and Long Run - Elasticity and Total Expenditure
D. 4.2 Price Elasticity of Supply - Determinants of Supply Elasticity
a. Ease of Substitution
b. Short Run and Long Run
E. 4.3 Elasticity Matters for Excise Taxes
F. 4.4 Other Demand Elasticities - Income Elasticity of Demand
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