Demand — relationship?
Quantity demanded decreases as price increases.
PED — definition?
Responsiveness of demand to price changes.
Public goods — features?
Non-rival, non-excludable, provided by government.
Demand — definition?
Quantity consumers are willing to buy at various prices.
Supply — relationship with price?
Direct relationship; higher prices lead to higher supply.
PED — measure of?
Responsiveness of quantity demanded to price changes.
Elastic demand — PED?
Greater than 1; sensitive to price changes.
Inelastic demand — PED?
Less than 1; less sensitive to price changes.
Unitarity elasticity — PED?
Equal to 1; proportional change in demand and price.
YED — role?
Shows demand variation with income.
Answer 9 questions on Understanding Microeconomic Market Dynamics.
1. What happens to demand when the price of a good increases, assuming other factors remain constant?
2. If a product has a price elasticity of demand (PED) of 0.8, how would you classify its demand?
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