Economics Study guide 2

the degree to which a demand or supply is sensitive to changes in price or income.

is a measure used to show the responsiveness, or elasticity, of the quantity demanded of a good or service to a change in its price, ceteris paribus.

Cross elasticity of demand (XED) is the responsiveness of demand for one product to a change in the price of another product. Many products are related, and XED indicates just how they are related.

Income elasticity of demand (YED) shows the effect of a change in income on quantity demanded.

Car-Gasoline

A "substitute" or "substitute good" is a product or service that a consumer sees as the same or similar to another product.

In economics, normal goods are any goods for which demand increases when income increases, and falls when income decreases but price remains constant

In economics, an inferior good is a good that decreases in demand when consumer income rises (or rises in demand when consumer income decreases), unlike normal goods, for which the opposite is observed.

Price elasticity of supply (PES) is a measure used to show the responsiveness, or elasticity, of the quantity supplied of a good or service to a change in its price.

A commodity is a marketable item produced to satisfy wants or needs. Economic commodities comprise goods and services.