Elasticity of demand

Consumers are sensitive to changes in price. A change in price can affect quantity demand. This calls and effect relationship in economics is known as what?

Elasticity

The extent to which a change in price causes a change in the quantity demand it is called what?

Demand elasticity

Demand is _____________ when a given change in price causes a relatively larger change in quantity demanded.

elastic

Sometimes a lower or higher price does not create much change in demand. When the change in demand is relatively small, the demand is considered what?

Inelastic

When the demand is exactly between elastic and inelastic, the demand is called what?

Unit elastic

Unit elastic demand calls is a _____________ change in quantity demanded.

Proportional

Two estimate elasticity, one can look at the fact that a price change has on _________________, which is the amount that consumer spend on a product at a regular price.

Total expenditures

Total expenditures are found by multiplying the price of a product by the quantity demand it. When the price goes down, total expenditures go up. This is called an _____________ relationship.

Inverse

For inelastic demand, total expenditures declined when the price declines. Four unit elastic demand, total expenditures remain unchanged when the price decreases. If the change in price and expenditures move in opposite directions demand is ________________.

Elastic

If they move in the same direction, demand is______________.

Inelastic

If there is no change expenditures, demand is _________________.

unit elastic

Several factors determine whether a good is elastic or inelastic. When I consumer need the product in the purchase cannot be put off, demand it tends to be _____________.

Inelastic

If there are enough substitutes available, consumers can switch back-and-forth between products in order to get the best price. Demand is said to be ________________.

Elastic

The fewer substitutes, however, the more inelastic the demand. If the purchase uses a large portion of income, people are more sensitive to price changes and demand tends to be _________________.

Elastic