00:01
So here we're talking elasticity, right? and remember that elasticity is the percentage change in quantity over the percentage change in price.
00:08
And revenue is equal to price times quantity.
00:11
Do you see how they have the same variables? that's what's really important here.
00:15
So if this is inelastic, this number is less than one if inelastic.
00:24
If you multiply, however, this means that the percent change in quantity is less than the percent change in the price.
00:31
Again, that's what inelastic means.
00:34
So here, what's going to happen? if this is true, when the price...
00:43
So we're thinking about increase in supply.
00:45
So we have a market, quantity and price...