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elasticity Essay

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Below is an essay on "elasticity" from Anti Essays, your source for research papers, essays, and term paper examples.

Elasticity is the tool of measuring the Markets
opinion about prices and quantity Demanded
;Supplied. It's the most popular tool among the
World and ,Everybody use it because it
simplifies data analysis,thus,no one uses other
ways because it's more accurate and more
simple.
Importance of elasticity:
1.Corporations how to make their prices
2.Consumer surplus.
3.Producer surplus
4.Government surplus
5. Ease on Economists to study their market
well.
Elasticity's idea is to describe the
responsiveness of quantity supplied or quantity
demanded TO price.
Price Elasticity:
When there's an Essential good like fuel if it's
price increase ,Consumers cant stop using it so
they'll search for a substitute some of poor
people installed gas system in their cars,lowermiddle
level people put 80 instead of 92 or
90,higher middle-level people put 90 instead of
92 …
This is a very Elastic Example of price
elasticity.
Classifying the demand and supply as
Elastic or inelastic:
when the quantity's percentage is more the
price percentage then the quantity demanded or
the quantity supplied then this case is Elastic.
E>=1
and if the price percentage is more than the
quantity's percentage then this case will be
Inelastic. E<1
there's two types of price elasticity:
Price elasticity of Demand & price elasticity of
supply:
PED's rule: ED=% Δ in quantity demanded
%Δ in price
PES's rule: ES =%Δ in quantity supplied
%Δ in price
calculating price elasticity using graph:
%change in price:
P2-P1
(P1+P2)/2
%change in quantity:
Q2-Q1 *100
(Q1+Q2)/2
types of Elastic and Inelastic Demand:
this is a figure of Perfectly inelastic demand:
this is a figure of perfectly Elastic demand
figure::
Factors that help elasticity:
1.substitutes: when there's a lot of substitutes
in the market for the same product Elasticity
happens,thus,when there's a lot of competitors
no company can raise the price more than the
other competitor EXCEPT...

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elasticity. Anti Essays. Retrieved December 14, 2018, from the World Wide Web: http://cassandralynndesignllc.com/free-essays/Elasticity-27041.html