elasticity of demand - miss mara's...
TRANSCRIPT
![Page 1: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/1.jpg)
E. Napp
Elasticity of Demand In this lesson, students will identify characteristic of elastic and inelastic demand. Students will be able to define and/or identify the following terms:
Elasticity Elastic Demand
Inelastic Demand Factors Affecting Elasticity of Demand
![Page 2: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/2.jpg)
E. Napp
Gas prices keep rising but we keep buying!
![Page 3: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/3.jpg)
E. Napp
Doesn’t the law of demand state that consumers buy less at higher prices?
So, why are we still buying gas?
![Page 4: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/4.jpg)
E. Napp
Elasticity of Demand
• Elasticity of demand is a measure of how consumers react to a change in price.
• Inelastic demand is demand that is not very sensitive to a change in price.
• Elastic demand is demand that is very sensitive to a change in price.
![Page 5: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/5.jpg)
E. Napp
Think pants. These pants have inelastic waistbands. The waistbands do not change if people gain weight.
![Page 6: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/6.jpg)
E. Napp
Our demand for gasoline is inelastic. It does not change even with a price
increase.
![Page 7: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/7.jpg)
E. Napp
Think pants again! Sweat pants have elastic waistbands. The pants change depending on the size of the person.
![Page 8: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/8.jpg)
E. Napp
Our demand for apple juice is elastic. If the price increases, we will buy less. Our demand
changes.
![Page 9: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/9.jpg)
E. Napp
So, why is our demand for apple juice elastic and our demand for gasoline
inelastic?
![Page 10: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/10.jpg)
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Factors Affecting Elasticity of Demand
• The following are factors that can affect the elasticity of demand:
Availability of Substitutes
Relative Importance Necessities Versus Luxuries
Time (It takes time to find substitutes.)
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E. Napp
It’s obvious, isn’t it? We can substitute orange juice
for apple juice. Therefore, we deal with a price increase by substituting one product for another
product.
![Page 12: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/12.jpg)
E. Napp
However, we cannot substitute milk for gasoline.
![Page 13: Elasticity of Demand - Miss Mara's Classkmara.weebly.com/uploads/7/7/2/9/77297615/ssemi3.c_notes... · 2018-09-04 · E. Napp Elasticity of Demand In this lesson, students will identify](https://reader030.vdocuments.us/reader030/viewer/2022040719/5e2a78b0b0563f41e27ecfca/html5/thumbnails/13.jpg)
E. Napp
What is this graph telling us about elasticity of demand?
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E. Napp
Questions for Reflection: • State the Law of Demand. • Why is the law of demand not always
true? • Define elasticity. • Provide one example of a good with
inelastic demand and explain why demand for that good is inelastic.
• Provide one example of a good with elastic demand and explain why demand for that good is elastic.