1. ELASTICITY Sensitivity to Change

2. Price Elasticity of Demand Sensitivity to changes in price Elastic Inelastic Elasticity & Revenue Use to determine your price – Computer ink Seminar charges

3. Other Demand Elasticities Income Cross –Antitrust cases

4. Total revenue and Elasticity If demand is elastic, and increase in price will lead to a decrease in total revenue. If demand is inelastic – just the opposite. The mineral spring Question

5. Public Policy Cigarettes Energy again Price Elasticity Income Elasticity

6. Price Elasticity of Supply The price of inputs –What does it mean to say that the price elasticity of supply is unit elastic?

7. Why should you care? Avoid mistakes – a higher price is no guarantee of higher revenue Interpreting data scanners Solve puzzles – property crime and drug use