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List the factors that affect price elasticity of demand and describe some applications of price elasticity of demand. 

          List the factors that affect price elasticity of demand and describe some applications of price elasticity of demand.

Added by Lisa G.

Principles of Economics
Principles of Economics
Gregory Mankiw 8th Edition
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List the factors that affect price elasticity of demand and describe some applications of price elasticity of demand.
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00:01 List the factors that affect price elasticity of demand and describe some applications of price elasticity of demand.
00:09 So price elasticity of demand is a measurement of the change in the consumption of a product in relation to a change in price.
00:57 Price elasticity helps us understand supply and demand for a product when the price changes.
01:04 So for example, if the price goes down and the demand for goes up by the same percentage that the price went down, we refer to that as an elastic product.
01:15 Like the demand for that is elastic.
01:17 But if the price goes down and the demand for that product does not go down by the same percentage, like it goes down by a smaller percentage, that's an inelastic product because our demand is less influenced by price than price influencing our demand...
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