Price Elasticity of Demand and Supply: Understanding Business Responses to Price Changes -, Study notes of Agricultural engineering

Download Price Elasticity of Demand and Supply: Understanding Business Responses to Price Changes - and more Study notes Agricultural engineering in PDF only on Docsity! 1 Lecture 6: Price and Revenue Elasticity 1. Although demand curves are downward sloping and supply curves are upward sloping, their degree of "steepness" or "flatness" can vary. 2. What does this mean? A "steep" demand curve, like: 0 20 40 60 80 100 120 10 20 30 40 50 quantity pr ic e means consumers don't change their purchasing behavior as much as with a more "flat" demand curve like: 0 20 40 60 80 100 120 10 20 30 40 50 quantity pr ic e 2 Likewise, with a "steep" supply curve, like: 0 20 40 60 80 100 120 10 20 30 40 50 quantity pr ic e businesses don't change their production as much when price changes as with a more "flat supply curve like: 0 10 20 30 40 50 60 70 80 10 20 30 40 50 quantity pr ic e