Applications of price elasticity of demand
Here is a case study with some questions to answer... https://docs.google.com/a/aisbudapest.org/document/d/1gWzLuzLCZVxQRZLXki4KEB2AihLBbOCXW7adPSuGm14/edit?usp=sharing This article Meet the credit crunch winners illustrates a good example of real life YED. And Will price discounting help restaurants survive the crunch? has example of all three concepts of demand elasticities. The last task for the elasticity topic is a case study on the market for air travel: http://e-conomics.weebly.com/uploads/1/9/1/7/19176587/elasticity_air_travel.pdf Also, below is a great 4 1/2 minute summary of PED... an excellent revision tool!
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Income elasticity of demand; its determinants and applications
Obviously, you all did your homework (except for __________?) and have already watched the above video on XED... hand in your graphs now. We will watch the YED graph together and then discuss both concepts and do some tasks, and then move on to PES. Price elasticity of demand and determinants
Look at the following list of products and try to place them in the correct order... most inelastic (least responsive to a price change) on top down to most elastic (most responsive to a price change)... We will discuss all of the concepts you need to be aware of and then do some practice equations and complete some notes. NOTE: I have written some theory notes with some worked examples and some practice questions for all the four types of elasticity here For my short explanation of why elasticity varies along the length of a linear demand curve, you can click this link https://docs.google.com/a/aisb.hu/file/d/0B2DnmWBd6LOCbzJzXzNSY2F2UWM/edit . Also I have posted PAJ Holden's video explanation of all the elasticity topics on this page. You will be given a copy of the following handout which covers the objectives above (as well as some objectives still to come)... but if you lose it then download and print out...
1.1 Competitive markets; market equilibrium; the role of the price mechanism; market efficiency10/18/2018
Market equilibrium
This is where we bring demand and supply together... X marks the spot! You will receive a packet of resources that we will use to meet the objectives above. The law of supply
Firstly I want you to watch the video and answer the questions on this form Now that we've done demand, supply should be easy as we are dealing with the same things but from the producer's point of view rather than the consumer... and you have to know/do the same things - the law of supply (hint: it's the opposite of the law of demand!), draw a supply curve, distinguish between a movement along the supply curve (because price changes) and a movement of the supply curve (when something other than price changes.... the ceteris paribus conditions). Once again, you will be given a couple of handouts with some tasks to do to fulfill these objectives. The non-price determinants of demand (factors that change demand or shift the demand curve)
We will discuss the responses to the Google Form, write some definitions and do some tasks. Next class you will have a quiz on demand (academic practice). The nature of markets
First up.... what are markets? Click here for task. Next we will consider demand. We will watch the video and discuss and then you will be given a copy of a document to complete (also linked here). And there will be homework! I will email you a Google Form which contains a short video to watch and questions to answer. This needs to be completed before the next class. |
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March 2021
Maree SpraggonTeacher of IB Economics at the American School of Budapest Categories |