Alfred Marshall 1842-1924. I. UNIT I A. DEMAND AND SUPPLY: ELASTICITIES AND APPLICATIONS 1. Price...
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Transcript of Alfred Marshall 1842-1924. I. UNIT I A. DEMAND AND SUPPLY: ELASTICITIES AND APPLICATIONS 1. Price...
Alfred Marshall 1842-1924
I. UNIT IA. DEMAND AND SUPPLY: ELASTICITIES
AND APPLICATIONS1. Price elasticity of demand
a. Calculationb. Interpretationc. Price elasticity of demand
and total revenue2. Price elasticity of supply
a. Calculationb. Interpretation
3. The consequences of price ceilings4. The consequences of price floors
Elasticity is a concept which measures theresponsiveness of
to
Elasticity is a concept which measures theresponsiveness of sellers/producers
price changes. to
P
Q0
D1
D2
P
Q0
D1
D2
P
Q0
D1
D2
P
Q0
D1
D2
S
S
P
Q0
D1
D2
P
Q0
D1
D2
S
S
P
Q0
D1
D2
P
Q0
D1
D2
S
S
A period of time so short that itis impossible for producersto respond to price changes.
Market Period
A period of time so short that itis impossible for producersto respond to price changes.
Supply Of Tuna Per Day From This Boat
S
Market Period
A period of time too short for....plant size to change.....the number of firms in anindustry to change
Short run
A period of time too short for....plant size to change.....the number of firms in anindustry to change
Supply of tuna in the short run S
Short run
A period of time too short for....plant size to change.....the number of firms in anindustry to change
Supply of tuna in the short run S
WITH EASY, CHEAP STORAGE
Short run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long run
A period of time long enough......for plant size to change.......the number of firms to
change
Long Run Supply
S
Long run
