0
Demand for food doesn't change in response to a change in price. Why?
Wiki User
∙ 7y agoWant this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
What is elasicity of demand?
The response of the quantity demanded with a change in price.
Does the price of corn rises and falls in response to change in supply and demand?
yes
How does price elasticity of demand affect a firm's pricing decisions?
The price elasticity of demand affects a firm's pricing decisions by determining the optimal profit margin. Price elasticity of demand describes the rate of change of demand in response to a change in price. The higher it is, the higher demand changes in respond to price; lower means very little change. For a good with low elasticity, it is easier to profit off marking-up the price because demand falls little in response to a price increase. For a high elasticity, prices should approach equilibrium because straying from equilibrium results in a higher change in demand than in price.
Define inelastic demand?
Inelastic demand is when the quantity demanded of a good doesn't respond strongly to changes in price The percentage change in quantity demanded is less than the percentage change in price (% change in Qd < % change in P) Equilibrium price (Ep) is less than 1 (Ep < 1) The demand curve for an inelastic good would be fairly steep Hope this helps! Reference: Holmes, Hannah. "Elasticity." [ECON 1B03]. MDCL 1305. McMaster University. September 19, 2008. Somebody else's response: when demand doesnt alter greatly in relation to an increase or decrease of price
Total expenditures are determined by what?
Dividing the change in demand for the product by its change in price. e=(change in demand)%/(change in price)%
What is elasicity of demand?
The response of the quantity demanded with a change in price.
Does the price of corn rises and falls in response to change in supply and demand?
yes
How does price elasticity of demand affect a firm's pricing decisions?
The price elasticity of demand affects a firm's pricing decisions by determining the optimal profit margin. Price elasticity of demand describes the rate of change of demand in response to a change in price. The higher it is, the higher demand changes in respond to price; lower means very little change. For a good with low elasticity, it is easier to profit off marking-up the price because demand falls little in response to a price increase. For a high elasticity, prices should approach equilibrium because straying from equilibrium results in a higher change in demand than in price.
Define inelastic demand?
Inelastic demand is when the quantity demanded of a good doesn't respond strongly to changes in price The percentage change in quantity demanded is less than the percentage change in price (% change in Qd < % change in P) Equilibrium price (Ep) is less than 1 (Ep < 1) The demand curve for an inelastic good would be fairly steep Hope this helps! Reference: Holmes, Hannah. "Elasticity." [ECON 1B03]. MDCL 1305. McMaster University. September 19, 2008. Somebody else's response: when demand doesnt alter greatly in relation to an increase or decrease of price
Total expenditures are determined by what?
Dividing the change in demand for the product by its change in price. e=(change in demand)%/(change in price)%
Income Elasticity of Supply and Demand?
The price elasticity of supply (or demand) is the percentage change in supply/demand for a one-percentage change in price. Eg, if the price elasticity is 1, a 1% change in the price of a good causes a 1% drop in price. (Note that elasticity is given in absolute value, since it is usually negative.)
What is determinants of price elasticity of demand?
The rate of change of price and the rate of change of demand as a function of price.
What is the meaning of elastricity demand?
The term elasticity indicates responsiveness of one variable to change in other variable.For e.g.,when variable x responds to change in variable y,variable x is said to be elastic.Likewise,demand is said to be elastic if it responds to change in price. There are three main determinants of demand,they are price of the commodity,income of the consumers,and price of the related goods.Thus,elasticity of demand means responsiveness of demand due to change in price of the commodity,income of the consumer,and price of the related gooods. Or you can say that,it measures the degree of change in the quantity demanded of the commodity in response to a given change in price of the commodity,change in consumer's income or price of the related goods. Accordingly,there are three main type of elasticities of demand: 1. Price elasticity of demand: Price elasticity of demand measures the responsiveness of demand for a commodity due to change in it's price. 2. Income elasticity of demand: It indicates the responsiveness of demand to change in consumer's income.It is the degree of change of demand to a change in consumer's income. 3. Cross elasticity of demand: It refers to change in quantity demanded of commodity x as a result of changes in the price of commodity y. Here, x and y can be either substitute goods or complementary goods).
How do you calculate arc elasticity of a commodity?
You calculate the arc elasticity of a commodity by dividing the change in demand by the average price, and then dividing that answer by the change in price divided by the average demand. So you will have (change in demand/average price)/(change in price/average demand).
Concepts of cross elasticity of demand and income elasticity of demand?
Cross price elasticity of demand measures the responsiveness in the quantity demand of one good when a change in price takes place in another good. Whereas, income of demand responds to the sensitivity of the quantity demanded for certain product in response to a change in consumer goods. Both concepts address the measurement of change in one respect compared to change in another.
Which term refers to the extent to which a change in price causes a change in demand?
Demand-price elasticity.
Supplier price response to excess demand?
supplier would increase the price
