**Elasticity **– Percentage change in one variable resulting from a 1% increase in another.

**Price Elasticity of Demand **– Percentage change in quantity demanded of a good resulting from a 1% increase in its price.

E/^{p} = *P ΔQ/ Q ∆P *=__%____ ____ΔQ/ % ∆ P__

**Infinitely elastic demand **– Principle that consumers will buy as much of a good as they can get at a single price, but for any higher price the quantity demanded drops to zero, while for any lower price the quantity demanded increases without limit.

**Completely inelastic demand **– Principle that consumers will buy a fixed quantity of a good regardless of its price.

**The steeper the slope of the cure, the less elastic demand is.

**Income elasticity of demand **– Percentage change in the quantity demanded resulting from a 1% increase in income.

E1 = __I ∆Q / Q ∆ I__

**Cross-price elasticity of demand **– Percentage change in the quantity demanded of one good resulting from a 1% increase in the price of another.

EQP= __P∆Q / Q ∆ P__

When goods are substitutes, cross-price elasticities will be positive. When goods are complements, cross-price elasticities will be negative.

**Price elasticity of supply **– Percentage change in quantity supplied resulting from a 1% increase in price.

**Point elasticity of demand **– Price elasticity at a particular point on the demand curve.

**Arc elasticity of demand **– Price elasticity calculated over a range of prices.

E = ( __∆Q__ ¿( *P*´ )

^{p} *∆* *P* *Q*´