Principles of Microeconomics / Unit 4 MIC 0301 short lesson, about 20 seconds
Elasticity Measures Responsiveness
Captions available
The idea
Elasticity measures how much one variable responds to a change in another, as a ratio of percentage changes. The laws of demand and supply give the direction; elasticity gives the size.
In practice
A ten percent fare rise might cut ridership by three percent or by fifteen.
Where people slip
Percentages, not units, so the answer is the same whether quantity is in pounds or tons.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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