AP Economics – 9/25/19

I.  Bellwork

Article:  How do retailers use elasticity to increase sales?

Questions & Answers

1. Do fake discounts increase quantity demanded like actual price decreases?
2. Should such fake sales be illegal?

II.  Objectives

• Interpret and construct graphs demonstrating elastic and inelastic demand explaining their differences
• Determine the various type of elasticities and their formuals
• Calculate and describe the relationship between elasticity and total revenues
• Identify the factors that determine price elasticity

III.  Interpreting Price Elasticity of Demand  Pages 467-474

A.  Elasticity and the Total Revenue Test- Micro 2.9

B.  Notebook WorK

1  468 Copy Figure 47.1 – Explain what each graph means.

2  Formula for perfect elasticity, perfect inelasticity, elastic, inelastic, unit elastic

3.  Draw and label:

• An inelastic demand curve
• An elastic demand curve

D.  Total Revenue/Expenditure Test ..

• Price Effect\
• Quantity Effect

E. Factors Determining Price Elasticity (4)

IV.  Exit Assignment Review on Page 475

AP Micro Economics F2019