ECON1

Price Elasticity of DemandAnswer all the questions below

1. Explain the term Price Elasticity2. What is the calculation for Price Elasticity of Demand3. Complete the table

Answer: Known as:0

Between 0 and -11

Above 1Infinite

4. Draw a graph to illustrate the following scenarios:a. Relatively Inelastic PeDb. Relatively elastic PeDc. Perfectly elastic PeDd. Perfectly inelastic PeD

5. For each of the graphs give an example of goods which could be considered to have each of the elasticities

6. Explain the factors which determine Price Elasticity of Demand7. Explain with reference the elasticity, how and why some firms can

pass the incidence of tax onto consumers

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