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  2. Price elasticity of demand - Wikipedia

    en.wikipedia.org/wiki/Price_elasticity_of_demand

    In other words, we can say that the price elasticity of demand is the percentage change in demand for a commodity due to a given percentage change in the price. If the quantity demanded falls 20 tons from an initial 200 tons after the price rises $5 from an initial price of $100, then the quantity demanded has fallen 10% and the price has risen ...

  3. Managerial economics - Wikipedia

    en.wikipedia.org/wiki/Managerial_economics

    Price Elasticity of Demand Analysis; The price elasticity of demand is a highly useful tool in managerial economics as it provides managers with the predicted change in demand associated with an increase in the price charged for its goods and services. [24] The price elasticity principle also outlines the changes in demand for goods with ...

  4. Elasticity (economics) - Wikipedia

    en.wikipedia.org/wiki/Elasticity_(economics)

    Like Price Elasticity of Demand, time also affects Price Elasticity of Supply. Though, there are other varying factors that affect this too, such as: capacity, availability of raw materials, flexibility, and the number of competitors in the market. Though, the time horizon is arguably the most influential detriment to price elasticity of supply ...

  5. Market structure - Wikipedia

    en.wikipedia.org/wiki/Market_structure

    According to the degree of price difference, price discrimination can be divided into three levels. [11] Natural monopoly, a monopoly in which economies of scale cause efficiency to increase continuously with the size of the firm. A firm is a natural monopoly if it is able to serve the entire market demand at a lower cost than any combination ...

  6. Lerner index - Wikipedia

    en.wikipedia.org/wiki/Lerner_Index

    The index ranges from 0 to 1. A perfectly competitive firm charges P = MC, L = 0; such a firm has no market power. An oligopolist or monopolist charges P > MC, so its index is L > 0, but the extent of its markup depends on the elasticity (the price-sensitivity) of demand and strategic interaction with competing firms. The index rises to 1 if ...

  7. Market power - Wikipedia

    en.wikipedia.org/wiki/Market_power

    The degree to which a firm can raise its price above marginal cost depends on the shape of the demand curve at a firm's profit maximising level of output. [47] Consequently, the relationship between market power and the price elasticity of demand (PED) can be summarised by the equation:

  8. Isoelastic function - Wikipedia

    en.wikipedia.org/wiki/Isoelastic_function

    An example in microeconomics is the constant elasticity demand function, in which p is the price of a product and D(p) is the resulting quantity demanded by consumers.For most goods the elasticity r (the responsiveness of quantity demanded to price) is negative, so it can be convenient to write the constant elasticity demand function with a negative sign on the exponent, in order for the ...

  9. Hicks–Marshall laws of derived demand - Wikipedia

    en.wikipedia.org/wiki/Hicks–Marshall_laws_of...

    In economics, the Hicks–Marshall laws of derived demand assert that, other things equal, the own-wage elasticity of demand for a category of labor is high under the following conditions: When the price elasticity of demand for the product being produced is high (scale effect). So when final product demand is elastic, an increase in wages will ...