supply and demand applications - chapter 4
TRANSCRIPT
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Supply and Demand
Applications
Chapter 4
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Topics
A. Price elasticity
Calculating elasticities
Demand
Supply
Applications
Economics of agriculture
Impact of a ta on price and !uantity
"loors and ceilings
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Price elasticity
Demand ho# much the !uantity
demanded changes #hen its price
changes
$ecessities
%uuries
Engel&s la#
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Price elasticity' cont&d(
Calculating elasticities)
Q
P
P
Q
PP
QQ
P
QED
=
=
=
/
/
%
%
2/)(
2/)(
2/)(2/)( 21
21
2121
PP
QQ
P
Q
PP
P
QQ
QED
+
+
=
+
+
=
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Elastic Demand Sho#s %arge
*uantity +esponse to Price
Change
Chapter 4
Figure 4-1
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Chapter 4
Table 4-1
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Price Elasticity of Demand "alls
into Three Categories
Chapter 4
Figure 4-2
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Perfectly Elastic
and Inelastic Demands
Chapter 4
Figure 4-3
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Chapter 4
Table 4-2
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Slope and Elasticity Are $ot
the Same Thing
Chapter 4
Figure 4-4
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A Simple +ule for Calculating the
Demand Elasticity
Chapter 4
Figure 4-5
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Elasticity and +e,enue)-Ch. 4. Tale 4./0
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Supply Elasticity Depends upon
Producer +esponse to Price
Chapter 4
Figure 4-6
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Applications)
Economics of Agriculture
Ta impact 1 incidence
"loors 1 ceilings minimum #age
energy price controls
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Prices of 2asic "arm Products
3a,e Declined Sharply
Chapter 4
Figure 4-7
C 4
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Agricultural Distress +esults from
Epanding Supply and PriceInelastic
Demand
Chapter 4
Figure 4-8
Ch 4
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Crop+estriction Program +aise
oth Price and "arm Income
Chapter 4
Figure 4-9
Ch t 4
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5asoline Ta "alls on 2oth
Consumer and Producer
Chapter 4
Figure 4-10
Ch t 4
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The 6inimum 7age and Teenage
8nemployment' 9:4;
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Effects of a 6inimum 7age
Chapter 4
Figure 4-12
Ch t 4
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Price Controls Produce
Shortages
Chapter 4
Figure 4-13