Principles of Microeconomics / Unit 4 MIC 0302 short lesson, about 20 seconds
Price Elasticity of Demand
Captions available
The idea
Price elasticity of demand is the percentage change in quantity demanded divided by the percentage change in price. The two move oppositely, so the ratio is negative; the course reports the absolute value.
In practice
A ten percent price rise cutting quantity twenty percent gives elasticity two.
Where people slip
It measures a movement along one demand curve; shifts have their own elasticities, in video three nineteen.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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