Economic applications of elasticity &Economists use elasticities to measure the sensitivity of o quantity demanded of commodity i with respect to the price of commodity i(own-price elasticity of demand,需求的自价格弹性) Demand for commodity i with respect to the price of commodity j (cross-price elasticity of demand 需求的交叉价格弹性)
Economic Applications of Elasticity ◆Economists use elasticities to measure the sensitivity of ⚫quantity demanded of commodity i with respect to the price of commodity i (own-price elasticity of demand，需求的自价格弹性) ⚫demand for commodity i with respect to the price of commodity j (cross-price elasticity of demand， 需求的交叉价格弹性)
Economic applications of elasticity Demand for commodity i with respect to income(income elasticity of demand需求的收入弹 性) quantity supplied of commodity i with respect to the price of commodity i (own-price elasticity of supply供给的自价格弹性)
Economic Applications of Elasticity ⚫demand for commodity i with respect to income (income elasticity of demand 需求的收入弹 性) ⚫quantity supplied of commodity i with respect to the price of commodity i (own-price elasticity of supply 供给的自价格弹性)
Economic applications of elasticity quantity supplied of commodity i with respect to the wage rate (elasticity of supply with respect to the price of labor) Oand many, many others
Economic Applications of Elasticity ⚫quantity supplied of commodity i with respect to the wage rate (elasticity of supply with respect to the price of labor) ⚫and many, many others
Own-Price Elasticity of Demand +Q: Why not use a demand curve's slope to measure the sensitivity of quantity demanded to a change in a commoditys own price?
Own-Price Elasticity of Demand ◆Q: Why not use a demand curve’s slope to measure the sensitivity of quantity demanded to a change in a commodity’s own price?
Own-Price Elasticity of Demand p slope slope 10 2 10 0.2 5 X1 50 X, In which case is the quantity demanded X,* more sensitive to changes to p,?
Own-Price Elasticity of Demand X1 5 * 50 10 10 slope = - 2 slope = - 0.2 p1 p1 In which case is the quantity demanded X1 * more sensitive to changes to p1? X1 *