microeconomics

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Title: microeconomics

Essay Details:

Subject: Business

Author: Donald B

Date: April 17, 2015

Level: University

Grade: A

Length: 4 / 1118

Essay text:

Emphasis: The percentages changes are compared, not the absolute changes. a. Absolute changes depend on choice of units. For example, a change in the price of a $10,000 car by $1 and is very different than a change in the price a of $1 can of beer by $1. The auto's price is rising by a fraction of a percent while the beer price is rising 100 percent. b. Percentages also make it possible to compare elasticities of demand for different products. Elasticity (page 362, Table 20.2) ? E > 1 ? demand is elastic ? Consumers are very responsive to changes in prices ? WHY? 1. Luxuries 2. Availability of Substitutes (more substitutes ? ?elasticity) 3...

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