Elasticities of Inputs

Price Elasticity of Supply

change in Q over Q divided by change in P over P, otherwise can be written as P over Q times the derivative of Q over the derivative of P

Price Elasticity of Demand

Percent change in quantity over percent change in price

Point Elasticity (used when just given demand curve or when changes go to or are coming up from zero)

Price of good over input times derivative of input over derivative of price

What is elasticity?

This is the measure of how responsive something is when prices change.

What does it mean when something is “unit elastic”?

This means that the response of something to a change in another variable results in equally proportional changes