Popular in Economics
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This 2 page Class Notes was uploaded by Alex Payton on Friday February 6, 2015. The Class Notes belongs to 101 at a university taught by Spangler in Fall. Since its upload, it has received 257 views.
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Date Created: 02/06/15
STUDY GUIDE COMING OUT NEXT WEEK It will have everything you need to know for the exam 22152615 Quotas reduce sell quota an upper limit set by the government on quantity of some good that can be bought or sold license the right to supply a good wedge difference between demand price and supply price at quota limit elastic increased price reduces quantity demanded by a lot inelastic the same increase in price reduces quantity demanded by a little bit elasticity DOESN39T EQUAL slope price elasticity of demand change quantity demanded change in price change quantity demanded change quantity demanded initial quantity demanded X100 change in price change in price initial price X100 price elasticity demanded change of quantity demanded change in price change in X absolute change in Xaverage value of X X100 average value of X starting value of X plus final value of X2 ex water is more inelastic in the desert than in Portland Total revenue price X quantity unitelastic quantity effects price fewer substitutes gt demand is inelastic many substitutes gt demand is elastic necessities don39t change quantity when price P changes luxuries we are more sensitive when price P changes inferior good as you get richer you want less of the good Vice versa EX pizza or top ramen horizontal integration buying out the competition British Motor Company bad car parts different sectors competed With each other no innovation foreign competition 1abor
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