New answers tagged behavioral-economics
1
Elasticity of demand is normally considered in relation to market demand for a good, that is, the sum of individual customer demands. Different customers will probably respond in different ways to a price increase. If the increase is 5%, especially on a low value item, very likely many customers will not notice, some will notice but not change their buying ...
2
The standard elasticity still makes sense. Elasticity is not necessarily constant. Also, I am not sure what sort of formula you learned at your college but elasticity is rigorously defined (and also taught at college level for econ majors) as $EL = \frac{df(x)}{dx}\frac{x}{f(x)}$ for some function $f(x)$ (see Essential Mathematics for Economic Analysis by ...
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