Purchase Solution

Price elasticity of demand

Not what you're looking for?

Ask Custom Question

Describe the price elasticity of demand for a resource. Why is it important and what is it used for?

Purchase this Solution
Solution Summary

This solution describes the price elasticity of demand for a resource.

Solution Preview

Price elasticity of demand (hereafter ped) describes the responsiveness for prices changes of a particular good/service. It is measure from 0 to -infinity. A ped between -1 to 0 is known as inelastic and this means that less responsive to price changes (0 is the extreme end, known as perfect inelastic and it means that consumers will not change the amount they purchase no ...

Purchase this Solution
Free BrainMass Quizzes
Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

View More Free Quizzes
Related BrainMass Solutions

  • Explaining elasticilty coefficients

    Elasticity of Demand Generally elasticity of demand refers to price elasticity of demand.

  • price elasticity of demand

    398086 How would you explain the concept of "price elasticity of demand"? How would you explain the concept of "price elasticity of demand"? How would you explain the concept of "price elasticity of demand"?

  • A Firm's Elasticity of Demand During Last 10-15 Years

    The formula for the Elasticity of Demand (EoD) is EoD = (% Change in Quantity Demanded)/(% Change in Price) The elasticity (or, a better term price elasticity) of demand it is used to see how sensitive the demand for a good is to a price change

  • cross price elasticities

    If price elasticity of demand is bigger then 1 then demand is price elastic (demand is sensitive to price changes ? If price elasticity of demand is equal to 1 then demand is unit elastic ?

  • Discusing Price Elasticity of Demand

    202581 Discusing Price Elasticity of Demand What is the definition of price elasticity of demand? Explain the relationship between price elasticity and total revenue? How does price elasticity of demand affect a firm's pricing decisions?

  • imperfect competitive market

    Use the following formula Profit-maximizing price = (Price elasticity of demand / 1 + Price elasticity of demand) * Variable cost per unit which is the same as Profit-maximizing price = (Price elasticity of demand / 1 + Price elasticity of demand

  • Estimating expected demand

    +1.32=11.528 million Study- Alkinson Income elasticity =+2.5 % change in income=+4% Price elasticity of demand=-1.4 % change in price=+6% Current Sales=11 million Change in sales due to price change= current sales*price elasticity of demand*percent

  • Price Elasticity and Elasticity of Demand

    In the case of used car price elasticity of demand which is 3, this means that the demand is price elastic. It is sensitive to price changes.

  • Calculating price and elasticity of demand

    Price elasticity of demand= Absolute value of price elasticity of demand is less than 1 in both the cases, we can say that demand is inelastic in both cases.

  • Effect on market equilibrium

    /(30-3p) Price elasticity of demand: = -9/21 Price elasticity of demand: = -3/7 Thus our price elasticity of demand is -3/7 b.

View More Related Solutions