Demand and supply change with price {elasticity, economics}|.
demand
Demand can change greatly with price, if substitute product is available, if product is not necessary, or if consuming that product is not a habit. Demand can change little with price, if no substitute product is available, if product is necessary, or if consuming the product is a habit.
elasticity
Percentage change in quantity demanded divided by percentage change in price {price elasticity} can be greater than one {elastic demand} or less than one {inelastic demand}.
revenue
Total revenue is price times quantity. Total revenue is greatest if elasticity equals one. Because costs minimize at maximum quantity, and price maximizes at minimum quantity, highest revenue has equal price and quantity change.
income
Percentage income change affects product quantity demanded {income elasticity}.
substitution
Related-product price changes {substitute product} {complementary product} affect demand for product {cross-elasticity}.
factors
Production-factor demand {derived demand} depends on demand elasticity, substitute availability, and percentage of total cost.
supply
Supply elasticity changes with new production methods, varying production-factor prices and quantities, and production expansion or contraction difficulty.
Social Sciences>Economics>Microeconomics>Supply And Demand
6-Economics-Microeconomics-Supply And Demand
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Date Modified: 2022.0224