This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Why does a demand curve with a constant slope not have a constant elasticity? What will be an ... (Read 321 times)

Zulu123

  • Hero Member
  • *****
  • Posts: 525
on: Jun 29, 2018
Why does a demand curve with a constant slope not have a constant elasticity?
 
  What will be an ideal response?

Question 2

What are the main influences on the elasticity of supply that make the supply of some goods elastic and the supply of other goods inelastic?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

smrtceo

  • Sr. Member
  • ****
  • Posts: 344
Reply #1 on: Jun 29, 2018
Answer to Question 1

The slope and the elasticity of a demand curve are different but related concepts. The slope of the demand curve shows how price changes in relation to quantity. The elasticity of demand shows the percentage change in quantity demanded due to a percentage change in price. If, for example, you are consuming two units of a good, increasing consumption by one unit means that your consumption of the good increases by 50. But if you have consumed 100 units of the good, an increase of one unit means that your consumption increases only by 1. The slope here however, will be equal to the decrease in price divided by the increase in the number of units consumed. If the demand curve is linear the slope will be constant but the elasticity (which measures the percentage change in demand) will not be constant.

Answer to Question 2

The main influences on the elasticity of supply are:
 Resource substitution possibilities: the greater the suppliers' ability to substitute resources, the greater will be their ability to react to price changes and the greater the elasticity of supply.
 Time frame for the supply decision: the greater the amount of time available after the price change, the greater is the suppliers' ability to adjust quantity supplied, and the greater the elasticity of supply.


Zulu123

  • Member
  • Posts: 525
Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

amit

  • Member
  • Posts: 364
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Glaucoma is a leading cause of blindness. As of yet, there is no cure. Everyone is at risk, and there may be no warning signs. It is six to eight times more common in African Americans than in whites. The best and most effective way to detect glaucoma is to receive a dilated eye examination.

Did you know?

About 80% of major fungal systemic infections are due to Candida albicans. Another form, Candida peritonitis, occurs most often in postoperative patients. A rare disease, Candida meningitis, may follow leukemia, kidney transplant, other immunosuppressed factors, or when suffering from Candida septicemia.

Did you know?

The first successful kidney transplant was performed in 1954 and occurred in Boston. A kidney from an identical twin was transplanted into his dying brother's body and was not rejected because it did not appear foreign to his body.

Did you know?

Many people have small pouches in their colons that bulge outward through weak spots. Each pouch is called a diverticulum. About 10% of Americans older than age 40 years have diverticulosis, which, when the pouches become infected or inflamed, is called diverticulitis. The main cause of diverticular disease is a low-fiber diet.

Did you know?

Oxytocin is recommended only for pregnancies that have a medical reason for inducing labor (such as eclampsia) and is not recommended for elective procedures or for making the birthing process more convenient.

The human oxygen-hemoglobin dissociation curve. The human oxygen-hemoglobin dissociation curve.
The oxygen isotope curve illustrates the ratio between 16O and 18O. The oxygen isotope curve illustrates the ratio between 16O and 18O.
Human photopic (cone) and scotopic (rod) spectral sensitivity curves. The peak of each curve has ... Human photopic (cone) and scotopic (rod) spectral sensitivity curves. The peak of each curve has ...
Slope Question Slope Question
Write equilibrium constant expressions for the following reactions in terms of concentration: Write equilibrium constant expressions for the following reactions in terms of concentration:
Type II curve. Mortality does not vary with age. Data for five-lined skink (Eumeces fasciatus). Type II curve. Mortality does not vary with age. Data for five-lined skink (Eumeces fasciatus).
Video: Role of the urinary system - acidosis and alkalosis

For a complete list of videos, visit our video library