Summary IB Economics Formula Sheet

Formula sheet IB Economics HL
Demand function:
𝑄𝑑 = 𝑎 − 𝑏𝑃
Qd = quantity demanded
P = price
a = Qd if price is zero
b = slope

Supply function:
𝑄𝑠 = 𝑐 + 𝑑𝑃
Qs = quantity supplied
P = price
a = Qs if price is zero
b = slope

Community surplus:

Consumer surplus + producer surplus = community surplus (total benefit to society)

% change for elasticities:

new value - old value
% change = × 100
old value

Price elasticity of demand (PED):

% change in Qd
PED =
% change in price

Cross elasticity of demand (XED):

% change in Qd of product X
XED =
% change in price of product Y

Income elasticity of demand (YED):

percentage change in Qd
YED =
% change in income of consumer

Price elasticity of supply (PES):

% change in Qs
PES =
% change in price