chapter-5PPT文档格式.ppt

chapter-5PPT文档格式.ppt

《chapter-5PPT文档格式.ppt》由会员分享，可在线阅读，更多相关《chapter-5PPT文档格式.ppt（60页珍藏版）》请在冰豆网上搜索。

Whatisthepriceelasticityofdemand?

Howisitrelatedtothedemandcurve?

Howisitrelatedtorevenue&

expenditure?

Whatisthepriceelasticityofsupply?

Howisitrelatedtothesupplycurve?

Whataretheincomeandcross-priceelasticitiesofdemand?

11ELASTICITYANDITSAPPLICATIONYoudesignwebsitesforlocalbusinesses.Youcharge$200perwebsite,andcurrentlysell12websitespermonth.Yourcostsarerising（includingtheopportunitycostofyourtime）,soyouconsiderraisingthepriceto$250.Thelawofdemandsaysthatyouwontsellasmanywebsitesifyouraiseyourprice.Howmanyfewerwebsites?

Howmuchwillyourrevenuefall,ormightitincrease?

Ascenario22ELASTICITYANDITSAPPLICATIONElasticityBasicidea:

Elasticitymeasureshowmuchonevariablerespondstochangesinanothervariable.Onetypeofelasticitymeasureshowmuchdemandforyourwebsiteswillfallifyouraiseyourprice.Definition:

ElasticityisanumericalmeasureoftheresponsivenessofQdorQstooneofitsdeterminants.3ELASTICITYANDITSAPPLICATIONPriceElasticityofDemandPriceelasticityofdemandmeasureshowmuchQdrespondstoachangeinP.Priceelasticityofdemand=PercentagechangeinQdPercentagechangeinPLooselyspeaking,itmeasurestheprice-sensitivityofbuyersdemand.4ELASTICITYANDITSAPPLICATIONPriceElasticityofDemandPriceelasticityofdemandequalsPQDQ2P2P1Q1Prisesby10%Qfallsby15%15%10%=1.5Priceelasticityofdemand=PercentagechangeinQdPercentagechangeinPExample:

5ELASTICITYANDITSAPPLICATIONPriceElasticityofDemandAlongaDcurve,PandQmoveinoppositedirections,whichwouldmakepriceelasticitynegative.Wewilldroptheminussignandreportallpriceelasticitiesaspositivenumbers.PQDQ2P2P1Q1Priceelasticityofdemand=PercentagechangeinQdPercentagechangeinP6ELASTICITYANDITSAPPLICATIONCalculatingPercentageChangesPQD$2508B$20012ADemandforyourwebsitesStandardmethodofcomputingthepercentage（%）change:

endvaluestartvaluestartvaluex100%GoingfromAtoB,the%changeinPequals（$250$200）/$200=25%7ELASTICITYANDITSAPPLICATIONCalculatingPercentageChangesPQD$2508B$20012ADemandforyourwebsitesProblem:

Thestandardmethodgivesdifferentanswersdependingonwhereyoustart.FromAtoB,Prises25%,Qfalls33%,elasticity=33/25=1.33FromBtoA,Pfalls20%,Qrises50%,elasticity=50/20=2.508ELASTICITYANDITSAPPLICATIONCalculatingPercentageChangesSo,weinsteadusethemidpointmethod:

endvaluestartvaluemidpointx100%Themidpointisthenumberhalfwaybetweenthestart&

endvalues,theaverageofthosevalues.Itdoesntmatterwhichvalueyouuseasthe“start”andwhichasthe“end”yougetthesameanswereitherway!

9ELASTICITYANDITSAPPLICATIONCalculatingPercentageChangesUsingthemidpointmethod,the%changeinPequals$250$200$225x100%=22.2%The%changeinQequals12810x100%=40.0%Thepriceelasticityofdemandequals40/22.2=1.810ELASTICITYANDITSAPPLICATIONACTIVELEARNINGACTIVELEARNING11Calculateanelasticity11Usethefollowinginformationtocalculatethepriceelasticityofdemandforhotelrooms:

ifP=$70,Qd=5000ifP=$90,Qd=300011ELASTICITYANDITSAPPLICATIONACTIVELEARNINGACTIVELEARNING11Answers12Usemidpointmethodtocalculate%changeinQd（50003000）/4000=50%changeinP（$90$70）/$80=25%Thepriceelasticityofdemandequals50%25%=2.012ELASTICITYANDITSAPPLICATIONWhatdeterminespriceelasticity?

Tolearnthedeterminantsofpriceelasticity,welookataseriesofexamples.Eachcomparestwocommongoods.Ineachexample:

Supposethepricesofbothgoodsriseby20%.ThegoodforwhichQdfallsthemost（inpercent）hasthehighestpriceelasticityofdemand.Whichgoodisit?

Why?

Whatlessondoestheexampleteachusaboutthedeterminantsofthepriceelasticityofdemand?

13ELASTICITYANDITSAPPLICATIONEXAMPLE1:

Breakfastcerealvs.SunscreenThepricesofbothofthesegoodsriseby20%.ForwhichgooddoesQddropthemost?

Breakfastcerealhasclosesubstitutes（e.g.,pancakes,Eggowaffles,leftoverpizza）,sobuyerscaneasilyswitchifthepricerises.Sunscreenhasnoclosesubstitutes,soconsumerswouldprobablynotbuymuchlessifitspricerises.Lesson:

Priceelasticityishigherwhenclosesubstitutesareavailable.14ELASTICITYANDITSAPPLICATIONEXAMPLE2:

“BlueJeans”vs.“Clothing”Thepricesofbothgoodsriseby20%.ForwhichgooddoesQddropthemost?

Foranarrowlydefinedgoodsuchasbluejeans,therearemanysubstitutes（khakis,shorts,Speedos）.Therearefewersubstitutesavailableforbroadlydefinedgoods.（Therearenttoomanysubstitutesf