Do inferrior goods have positive of negative YED's?
Negative, for example if the income were to fall by 10% the demand for inferrior goods would rise by 20% assuming the YED for the good is -2 (-10% x -2 = 20%)
4 of 8
How do you calculate XED?
% change in quantity demanded of good A / % change in price of good b
5 of 8
What does it mean if the XED is positive?
they are substitutes.
6 of 8
Which factors affect PED?
Avalability of substitutes, luxury, % of income, Time -Long run, short run
7 of 8
What factors affect PES?
Spare capacity, flexible working patters, length of the production period, time, the availability of stock
8 of 8
Other cards in this set
Card 2
Front
how do you calculate PES?
Back
% change in QS/ % change in price
Card 3
Front
How do you Calculate YED?
Back
Card 4
Front
Do inferrior goods have positive of negative YED's?
Comments
No comments have yet been made