Microeconomics Exam 2 Complete Questions With 100% Verified Answers || 2025/2026 Update

Microeconomics Exam 2 Complete Questions With 100% Verified Answers || 2025/2026 Update Elasticity a measure of responsiveness to change Helps businesses and governments make better decisions and it helps producers maximize their reveneus Price elasticity of demand measures the responsiveness of quantity demanded due to a change in price |%^Q/%^P| not negative. LOD - Demand falls, price increases Pure number No units, allows to compare elasticities without worrying Demand is Elastic When Ed > 1 Demand is inelastic when Ed < 1 Demand is Unit Elastic when ED = 1 Demand is perfectly elastic When ED = infinity Demand is perfectly inelastic Ed = 0 Existence of close substitutes Demand is more elastic when there are more close substitutes Diet Coke vs. insulin