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Warm Up Questions : PowerPoint Presentation
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Warm Up Questions :

Warm Up Questions :

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Warm Up Questions :

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  1. Warm Up Questions: • If you were a business owner and you wanted to increase your income which would you choose - increase your prices or have a sale? • Is it possible to make more money in both scenarios? Explain.

  2. Elasticity of Demand Chapter 4 Section 3

  3. Demand Elasticity • The extent to which a change in price causes a change in the quantity demanded. • Elastic • When a change in price causes a relatively large change in the quantity demanded • Inelastic • When a change in price causes a relatively small change in the quantity demanded

  4. Determinants of Demand Elasticity • Can a purchase be delayed? • Yes would indicate elastic. • Are adequate substitutes available? • Yes would indicate elastic. • Does the purchase use a large portion of income? • Yes would indicate elastic. • Two of three will determine elasticity.

  5. Elastic or Inelastic? • Table Salt • Can a purchase be delayed? • Are adequate substitutes available? • Does the purchase use a large portion of income? • Elastic • Insulin • Can a purchase be delayed? • Are adequate substitutes available? • Does the purchase use a large portion of income? • Inelastic • Gasoline from Kwik Trip • Can a purchase be delayed? • Are adequate substitutes available? • Does the purchase use a large portion of income? • Elastic

  6. Chapter 4 Section 3 Review • Page 104 • #3 – 11 • DUE TOMORROW • If you finish please work on your Chapter 4 Study Guide.