Introduction to Elasticity in Economics

When introducing the concepts of supply and demand, economists often make qualitative statements about how consumers and producers behave. For example, the law of demand states that as the price of a good or service increases, the demand for that good or service decreases. The law of supply states that the quantity of a good produced tends to increase as the market price of that good increases. While these laws are useful, they dont capture everything that economists would like to include in the supply and demand model; as a result, economists have developed quantitative measurements such as elasticity to provide more detail about market behavior. Elasticity, in short, refers to the relative tendency of certain economic variables to change in response to other variables. In economics, it is important to understand how responsive quantities such as demand and supply are to things like price, income, the prices of related goods, and so on. For example, when the price of gasoline increases by one percent, does the demand for gasoline go down by a little or a lot? Answering these sorts of questions is extremely important to economic and policy decision making, so economists have developed the concept of elasticity to measure the responsiveness of economic quantities. Types of Elasticity Elasticity can take a number of different forms, depending on what cause and effect relationship economists are trying to measure. Price elasticity of demand, for example, measures the responsiveness of demand to changes in price. Price elasticity of supply, in contrast, measures the responsiveness of quantity supplied to changes in price. Income elasticity of demand measures the responsiveness of demand to changes in income, and so on. How to Calculate Elasticity Measures of elasticity all follow the same basic principles, no matter which variables are being measured. In the discussion that follows, well use price elasticity of demand as a representative example. Price elasticity of demand is calculated as the ratio of the relative change in quantity demanded to the relative change in price. Mathematically, the price elasticity of demand is just the percent change in quantity demanded divided by the percent change in price: Price elasticity of demand Percent change in demand / Percent change in price In this way, the price elasticity of demand answers the question What would be the percent change in quantity demanded in response to a one percent increase in price? Notice that, because price and quantity demanded to tend to move in opposite directions, the price elasticity of demand usually ends up being a negative number. To make things simpler, economists will often represent price elasticity of demand as an absolute value. (In other words, the price elasticity of demand could just be represented by the positive part of the elasticity number, eg. 3 rather than -3.) Conceptually, you can think of elasticity as an economic analog to the literal concept of elasticity. In this analogy, the change in price is the force applied to a rubber band, and the change in quantity demanded is how much the rubber band stretches. If the rubber band is very elastic, the rubber band will stretch a lot. If its very inelastic, it wont stretch very much, and the same can be said for elastic and inelastic demand. In other words, if demand is elastic, it means a change in price will result in a proportional change in demand. If demand is inelastic, it means a change in price will not result in a change in demand. You may notice that the equation above seems similar, but not identical to, the slope of the mand curve (which also represents price versus quantity demanded). Because the demand curve is drawn with the price on the vertical axis and quantity demanded on the horizontal axis, the slope of the demand curve represents the change in price divided by the change in quantity rather than the change in quantity divided by the change in price. In addition, the slope of the demand curve shows absolute changes in price and quantity whereas price elasticity of demand uses relative (i.e. percent) changes in price and quantity. There are two advantages to calculating elasticity using relative changes. First, percent changes dont have units attached to them, so it doesnt matter what currency is used for the price when calculating elasticity. This means that elasticity comparisons are easy to make across different countries. Second, a one-dollar change in the price of an airplane ticket versus the pr ice of a book, for example, are likely not viewed as the same magnitude of change. Percentage changes are more comparable across different goods and services in many cases, so using percent changes to calculate elasticity makes it easier to compare the elasticities of different items.

The Discovery Of The New World - 1178 Words

America, the third largest country in the world, is a place that most people desire to live in. It is filled with fifty states and each with plentiful opportunities spread amongst it. America is considered the land of opportunity because it gives opportunities to immigrants that their country cannot provide them with such as: economic stability and educational resources. America is also known today as the melting pot because so many cultures have mixed together in one country to enjoy the same free lifestyle! The important question that everyone should be asking is, who discovered this extraordinary country that everyone enjoys the luxuries of today? To answer that question, Christopher Columbus is credited with the discovery of â€Å"The New World† as we know today as America. He is referred to as one of the greatest discovers’ during the Age of Discovery. Christopher Columbus is an Italian explorer, navigator, and colonizer. He was born in 1451 in the Republic of Geno a, Italy. He was the son of a wool merchant. When he was barely in his adolescent years, he worked with his father but later went to sea at the age of fourteen. He was at sea until a tragic event happened in 1470. His journey ended when French pioneers attacked his ship as it was sailing along the coast in Portugal. His boat went down, but he swam to shore and found his way to Lisbon, which is the capital and largest city in Portugal. While there, he studied mathematics, astronomy, cartography, and navigation.Show MoreRelatedThe Discovery Of The New World1075 Words   |  5 PagesSince the arrival of Columbus to the New World in 1492, it began a new era for the Spanish Empire. During this time Spain successfully conducted the Reconquista back home and were power hungry for more land to conquer to keep the momentum going. The early explorations would lead to bigger conquest and fortunes for the Spaniards. After the reunification of Spain with Queen Isabella and King Ferdinand, they financed the expedition for the Genoese explorer, Christopher Columbus, for trading routesRead MoreThe Discovery Of The New World903 Words   |  4 PagesAfter the discovery of the New World in 1492 many issues and uproars took place. Particularly, Christopher Columbus viewed America as an opportunity for mankind to begin again. While Bartolomeo de las Cases considered the New World a place of abuse for the Native Americans and took the initiative to save the Native people. In general, the Europeans felt that the America had benefits and major setbacks of coming to the new lands. The following documents â€Å"The Meaning of America†, â€Å"Utilizing the NativeRead MoreThe Discovery Of The New World1191 Words   |  5 PagesThe discovery of the New World brought many irreversible changes not only for the European countries, but to the natives of the land that was being discovered. The sense of ex ploration began expanding more and more among the European powers. Every time the explorers invaded, they would be more avaricious and aggressive against the natives of the land. Along with diseases and inhumane treatments, the European powers also brought education to the â€Å"uneducated† crowds of areas such as India, Africa,Read MoreThe Discovery Of The New World Essay1726 Words   |  7 Pagesoverthrow of a suppressive government in favor of a new government, but it is also defined as a large change in society, or how it works. After the discovery of the New World by Christopher Columbus, European Nations competed in a race against one another to claim pieces of the new land. Before Columbus found this land, the sea separating the New World from Europe seemed endless. The Europeans were only interested in the land to the East. But with the New World there was so much to explore. The EuropeansRead MoreThe Discovery Of The New World1641 Words   |  7 Pagesship design t hat lead to the discovery of the New World and enabled the subsequent expansion in global trade? In this paper I will examine the changes and improvements in European ship design that allowed for the first transatlantic voyage to the New World. Though the Europeans were not the first to develop the concept of the ship, they were the first to take this concept and use it to cross the Atlantic. Even before Columbus sailed across the Atlantic to the New World, Europe had a long maritimeRead MoreThe Discovery Of The New World1128 Words   |  5 Pageswe really thank Columbus? He was not the first European to discover America, but he was the first to set voyage and sail across the fearful Atlantic to land in the New World. Soon the Spanish, Portuguese, British, Dutch and other European nations grew curious of this land on the other side of the world. The discovery of the New World was responsible for the transport of foods, domesticated plants, animals, diseases and most importantly human beings. The Atlantic Slave Trade became a thriving businessRead MoreThe Discovery Of The New World1257 Words   |  6 Pagesof America, recent World crops a bit like wheat, barley, rice, and turnips had not traveled west across the Atlantic , and New World crops a bit like maize, white potatoes, sweet potatoes, and manioc had not traveled east to Europe. among land, there aren t any horses, cattle, sheep, or goats, all animals of recent World origin. apart from the placental, alpaca, dog, a few fowl, and guinea pig, the New World had no equivalents to the domesticated animals about the recent World, nor did it have theRead More Columbus and the New World Discovery Essay4487 Words   |  18 PagesColumbus and the New World Discovery October 12, 1992, marks the five-hundredth anniversary of the most crucial of all encounters between Europe and the Americas. In the contemporary global mood, however, the quincentennial of Christopher Columbuss landing in the New World - new, anyway, to the European intruders; old and familiar to its inhabitants - seems an occasion less for celebration than for mediation. Indeed, in some quarters the call is for penitence and remorse. Christopher ColumbusRead More The Merging of Cultures During the New World Discovery Essay1066 Words   |  5 PagesThe Merging of Cultures During the New World Discovery The voyages of the Iberians marked history. The discovery of the new world meant the unification of two old worlds. These old worlds had different beliefs, attitudes, language, and values. The culture of these two worlds would never be the same. The native peoples of America at the end of the fifteenth century ranged from the simplest hunting-fishing-gathering societies to highly developed civilizations with urban and peasant componentsRead MoreDevastation of New World Ecosystems During the Age of Discovery3100 Words   |  13 PagesThe New World, in the minds and descriptions of European explorers and settlers during the sixteenth century, was comparable to a paradise on earth. The landscape was so vast and indescribably beautiful that even Columbus had trouble articulating its splendor. However, lacking a consciousness of conservation, Europeans felt little remorse in exploiting the land and subjugating its people. From the beginning Europeans set out to transform as much of the New World into the Old World as possible. As

Quality Control and Business Free Essays

Description of business The I-TEC Corporation is runned as a partnership of fifteen people. The numbers are important to guide the business to the right path of success. Ideas from each partner contribute to the growth of the business to new heights. We will write a custom essay sample on Quality Control and Business or any similar topic only for you Order Now The objective of the business is to provide low cost computers. It was started to address the problems that the country was facing with the â€Å"up to date† technology. If a country doesn’t have access to computers, the citizens will not be able to know what is going on in foreign countries and will be classed as â€Å"stone age†. ————————————————- Location: The business is located in Cul-de-sac which is not too far from the capitals town. It is an ideal spot because of its accessibility to transportation. Vehicles can both leave and enter the capital without the extra cost. It is also close to the docks where the business imports different parts for the manufacturing of the computers. It is also a government incentive, meaning the land was cheaper if the business had to purchase its own land. The type of labor needed is -professional -skilled -semi-skilled -unskilled Professional Management (1 for each sector of management)- to assist with the initial stability of the business also to check on production and marketing aspects. Skilled Workers, It technicians, inspectors, etc(5 in each department). to allow the business to be successful and to ensure that the work is being done right. Semi-skilled Drivers and transportation staff (about 12 drivers) – to ensure that products and raw material is transported in or out of the business safely. Unskilled Cleaning staff (10 to be able to cover that entire factory) – to ensure that the business is clean and a healthy environment. Sources of fixed and working capital Fixed capital started with a loan from the bank. This sum of money enabled the business to cover up cost of the foundation and structure of the building, transportation and various machinery. Working capital was funded by the partner’s personal expenditure after saving money over the years and a small contribution by the bank ————————————————- As the entrepreneur I am the one with idea and goal to start off the business. Therefore I am the one how take serious accountability and inherits all the risks of the business. ROLES OF BEING THE ENTREPRENEUR -responsibility of taking the risks of owning a business -responsibility to ensure that the business is profitable ————————————————- all liabilities are directed straight to his funds ————————————————- Type of production The business has a domestic range of production. Meaning that the busi ness presently sells to the market available in the country it is situated in. after a few years, the business hopes to grow into an exporting production era, when we will sell to other countries around the world. Level of production The company has a secondary level of production. It produces products from their raw material state and then sells it to the market. Mainly the business focuses on the production of the product. In the secondary level of production, the business imports parts that are already manufactured from other companies and puts them together. ————————————————- Quality control measures Inspectors from the Bureau of Standards check the quality of products and equipment in the business. They certify that each product is of a certain standard for the country. There are also business inspectors to ensure that the business keeps up with the quality expected. They ensure that the best type of machinery and products are bought from the top manufacturers. The business inspectors also look at products at each stage of production to provide perfect quality. Use of technology In the aspect of technology the business uses it to its advantage. Computers, security cameras, machinery controls are used on a daily basis in the company. Technology is simply needed to make the business run smother and more effective. For example, the machinery is used to make the work load on the business’ human recourses much easier. The involvement with the World Wide Web also influences the progress of the business. Linkages The business mainly focuses on its forward linkages, which is people that the business sells to. The service sector, banking, education, financial, health, helps the business grow in many ways. A forward linkage benefits the business because it provides a steady market to sell products to the customers. ————————————————- Potential Growth Over a period of time, the business would be hoping to improve both internal and externally. INTERNAL The increase of working staff and increase in production. Develop on the products made and provide more variety of the items sold. Therefore the income earned by the business will increase. EXTERNAL The movement of location or expansion of the business. Opening more branches both locally and regionally. Government regulations Employment regulation-The business must have a regulation to permit employment to others. If not when the business employs people it would be illegal. Taxation- Taxation must be followed by all businesses to support the government to improve. This cooperation has no exception. Import and Export license- The business needs to be certified to export and import to other countries. Ethical issues Production – the business will have to have an environment friendly production plant where the emissions from the manufacturing plant will be reduced drastically. The company follows the theme less steam go green be clean. Disposal – the equipment that is not being used and the waste material is properly disposed by the company’s personal sanitation officers. Worker treatment – employees are treated with a family-like environment where each employee would feel like him or her is in a comfortable job. How to cite Quality Control and Business, Papers

Macbeth Hero Essay Example For Students

Macbeth Hero Essay The character of Macbeth is a example of a tragic hero. There are many factorswhich contribute to the deterioration of Macbeth of which three will bediscussed. The three points which contribute greatly to Macbeths deteriorationare the prophecy which was told to him by the witches, how Lady Macbethinfluenced and manipulated Macbeths judgment, and finally Macbeths long timeambition which drove his desire to be king. Macbeths growing characterdeterioates from a noble man to violent individual. The prophecies which weretold by the witches were one of the factors which contributed to thedeterioration of his character. If it had not been for the witches telling himthat he was to be Thane of Cawdor, Thane of Glamis, and King of Scotland,Macbeth would still be his ordinary self. As a result of the prophecies, thisaroused Macbeths curiosity of how he could be King of Scotland. As the playprogresses, Macbeth slowly relies on the witches prophecies. The influence ofMacbeths wife, Lady Macbeth a lso contributed to his deterioration of character. Lady Macbeths character in the beginning reveals that she is a lovable person. When Lady Macbeth was ready to kill King Duncan herself, it showed that LadyMacbeth could not murder King Duncan because he reminded her of her father. Thisproves that Lady Macbeth has a heart deep inside her. Lady Macbeth plays animportant role in this play because she provided a scheme which caused Macbethto assassinate King Duncan. After Macbeth had killed King Duncan, he laterregrets on his wrong doing. At the point of this play the audience can note thechange in Macbeths character. Macbeths first murder was a trying experiencefor him, however after the first murder, killing seemed to be the only solutionto maintain his reign of the people of Scotland. Therefore, it was Lady Macbethwho introduced the concept of murder to Macbeth. Macbeths ambition alsoinfluenced his declining character. However, Macbeths ambition had not beenstrong enough to carry the motive to kill King Duncan. Lady Macbeths influencealso comes in to play because if not for Lady Macbeth, his ambition would notha ve been intensified enough to drive him to obtain and maintain his title ofKing of Scotland no matter what it took, even if it meant murdering. Macbethsambition influenced the cause of his new character. This new character ofMacbeth contained greed, violence, and power hunger. Macbeth shows this when hekills King Duncan. In conclusion, the prophecies given to him by the witches,Lady Macbeths influence and plan, and his intensified ambition, all contributedgreatly to his deterioration of character which resulted to hisdownfalldeath. Therefore Macbeth character displays strong signs of a tragichero, making him the ideal classic example. Shakespeare