曼昆经济学原理第五章.ppt

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1、5ElasticityandItsApplicationsElasticity...…allowsustoanalyzesupplyanddemandwithgreaterprecision.…isameasureofhowmuchbuyersandsellersrespondtochangesinmarketconditionsTHEELASTICITYOFDEMANDPriceelasticityofdemandisameasureofhowmuchthequantitydemandedofagoodrespondstoachangeinthepriceofthatg

2、ood.Priceelasticityofdemandisthepercentagechangeinquantitydemandedgivenapercentchangeintheprice.ThePriceElasticityofDemandandItsDeterminantsAvailabilityofCloseSubstitutesNecessitiesversusLuxuriesDefinitionoftheMarketTimeHorizonThePriceElasticityofDemandandItsDeterminantsDemandtendstobemor

3、eelastic:thelargerthenumberofclosesubstitutes.ifthegoodisaluxury.themorenarrowlydefinedthemarket.thelongerthetimeperiod.ComputingthePriceElasticityofDemandThepriceelasticityofdemandiscomputedasthepercentagechangeinthequantitydemandeddividedbythepercentagechangeinprice.Example:Ifthepriceof

4、anicecreamconeincreasesfrom$2.00to$2.20andtheamountyoubuyfallsfrom10to8cones,thenyourelasticityofdemandwouldbecalculatedas:ComputingthePriceElasticityofDemandTheMidpointMethod:ABetterWaytoCalculatePercentageChangesandElasticitiesThemidpointformulaispreferablewhencalculatingthepriceelastic

5、ityofdemandbecauseitgivesthesameanswerregardlessofthedirectionofthechange.TheMidpointMethod:ABetterWaytoCalculatePercentageChangesandElasticitiesExample:Ifthepriceofanicecreamconeincreasesfrom$2.00to$2.20andtheamountyoubuyfallsfrom10to8cones,thenyourelasticityofdemand,usingthemidpointform

6、ula,wouldbecalculatedas:TheVarietyofDemandCurvesInelasticDemandQuantitydemandeddoesnotrespondstronglytopricechanges.Priceelasticityofdemandislessthanone.ElasticDemandQuantitydemandedrespondsstronglytochangesinprice.Priceelasticityofdemandisgreaterthanone.ComputingthePriceElasticityofDeman

7、dDemandispriceelastic$54DemandQuantity100050PriceTheVarietyofDemandCurvesPerfectlyInelasticQuantitydemandeddoesnotrespondtopricechanges.PerfectlyElasticQuantitydemandedchangesinfinitelywithanychangeinprice.UnitElasticQuantitydemandedchangesbythesamepercentageasthepr