1
Q
What is PED?
A
PED is the responsiveness of the demand for a good to a change in its price
2
Q
What is the formula for PED?
A
Percentage change in quantity demanded/
Percentage change in price
3
Q
What is the formula for percentage change?
A
New value - original value
————————————– x 100%
Original value
4
Q
When is demand elastic?
A
If the PED calculation is greater than (minus) one
5
Q
When is demand inelastic?
A
If the PED calculation is between zero and (minus) one
6
Q
Why is it important for a firm to know its PED?
A
So that the firm can judge what might happen to total revenue and profits if its price changes
7
Q
What is the formula for TR?
A
P x Q sold
8
Q
What is the formula for profit?
A
TR - TC
Economics A-Level Micro
flashcards
Decks in class (32)
# Cards
-
1) Economics as a social science3
-
2) Economic Data3
-
3) The economic problem5
-
4) PPF's3
-
5) Specialisation and the division of labour7
-
6) Types of Economy4
-
7) Rational decision making5
-
8) Demand4
-
9) PED8
-
10) YED and XED9
-
11) Supply8
-
12) Price determination3
-
13) Interrelationships between markets5
-
14) Indirect taxes and subsidies4
-
19) The price mechanism1
-
20) Types of market failure4
-
21) Externalities8
-
22) Information gaps4
-
23) Public and merit goods5
-
24) Government intervention in markets1
-
25) Government failure3
-
45) Production4
-
46) Costs8
-
47) Revenue5
-
48) Profit5
-
49) Market structure7
-
50) Perfect Competition7
-
51) Monopoly8
-
52) Monopolistic competition1
-
53) Oligopoly9
-
54) Contestability3
-
Equations8
