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<a https://www.thestudentroom.co.uk/showthread.php?t=7467335'> Year 12s: what will be the first way you research your future options? >>
<a https://www.thestudentroom.co.uk/showthread.php?t=7467335'> Year 12s: what will be the first way you research your future options? >>

Elasticities

Hey does anyone have any good ways to remember the elasticities, or can help me fully understand them? So price, income and cross elasticity of demand, and price elasticity of supply.

I'm retaking Econ 1 on Monday and I always get the questions wrong, and they come up in every single paper :frown: Thanks!
Understanding and memorising is the best way.
However, you can just work it out on the fly using logic and the data
For example:
PED, -20% change in price but only +10% D means inelastic as D less than responsive to change in price. calculate it and sure enough its less than 1 (0.5)
PES, same as above but with S
YED, income raises and demand falls? inferior. Income raises and so does demand? normal or luxury(more elastic).
XED, price falls for one product and demand for the other rises, compliments(visa-versa for substitutes)
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Original post by Aydin7
Understanding and memorising is the best way.
However, you can just work it out on the fly using logic and the data
For example:
PED, -20% change in price but only +10% D means inelastic as D less than responsive to change in price. calculate it and sure enough its less than 1 (0.5)
PES, same as above but with S
YED, income raises and demand falls? inferior. Income raises and so does demand? normal or luxury(more elastic).
XED, price falls for one product and demand for the other rises, compliments(visa-versa for substitutes)


Ah lifesaver, thaaaanks!
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Original post by AnIndianGuy
Just rewrite each one over and over again. GOGOGO


Thanks! :smile:
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Pato1
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https://www.youtube.com/watch?v=difGsq0aD8E
Fantastic teacher
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Ah thank you so much that's so helpful!! :biggrin::biggrin:
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Original post by Pato1


ooh never seen him before, so thanks that's great :smile:
If you are in to football at all you will know the team QPR. This is a good way of remembering that in the equation Q comes before (on top of) PR.

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