微觀經(jīng)濟(jì)學(xué)課件

ChapterFifteenMarketDemandFromIndividualtoMarketDemandFunctionsThinkofaneconomycontainingnconsumers,denotedbyi=1,…,n.Consumeri’sordinarydemandfunctionforcommodityjis

FromIndividualtoMarketDemandFunctionsWhenallconsumersareprice-takers,themarketdemandfunctionforcommodityjis

Ifallconsumersareidenticalthen

whereM=nm.FromIndividualtoMarketDemandFunctionsp1p12015p1’p1”p1’p1”FromIndividualtoMarketDemandFunctionsp1p1p12015p1’p1”p1’p1”p1’FromIndividualtoMarketDemandFunctionsp1p1p12015p1’p1”p1’p1”p1’p1”ElasticitiesElasticitymeasuresthe“sensitivity”ofonevariablewithrespecttoanother.TheelasticityofvariableXwithrespecttovariableYisEconomicApplicationsofElasticityEconomistsuseelasticitiestomeasurethesensitivityofquantitydemandedofcommodityiwithrespecttothepriceofcommodityi(own-priceelasticityofdemand)demandforcommodityiwithrespecttothepriceofcommodityj(cross-priceelasticityofdemand).EconomicApplicationsofElasticitydemandforcommodityiwithrespecttoincome(incomeelasticityofdemand)quantitysuppliedofcommodityiwithrespecttothepriceofcommodityi(own-priceelasticityofsupply)Own-PriceElasticityofDemandQ:Whynotuseademandcurve’sslopetomeasurethesensitivityofquantitydemandedtoachangeinacommodity’sownprice?Own-PriceElasticityofDemandX1*5501010slope

=-2slope

=-0.2p1p1Inwhichcaseisthequantitydemanded

X1*moresensitivetochangestop1?X1*Own-PriceElasticityofDemand5501010slope

=-2slope

=-0.2p1p1X1*X1*Inwhichcaseisthequantitydemanded

X1*moresensitivetochangestop1?Own-PriceElasticityofDemand5501010slope

=-2slope

=-0.2p1p110-packsSingleUnitsX1*X1*Inwhichcaseisthequantitydemanded

X1*moresensitivetochangestop1?

Itisthesameinbothcases.Own-PriceElasticityofDemandQ:Whynotjustusetheslopeofademandcurvetomeasurethesensitivityofquantitydemandedtoachangeinacommodity’sownprice?A:Becausethevalueofsensitivitythendependsuponthe(arbitrary)unitsofmeasurementusedforquantitydemanded.Own-PriceElasticityofDemandisaratioofpercentagesandsohasno

unitsofmeasurement.

Henceown-priceelasticityofdemandisasensitivitymeasurethatisindependentofunitsofmeasurement.ArcOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatisthe“average”own-price

elasticityofdemandforprices

inanintervalcenteredonpi’?ArcOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatisthe“average”own-price

elasticityofdemandforprices

inanintervalcenteredonpi’?ArcOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatisthe“average”own-price

elasticityofdemandforprices

inanintervalcenteredonpi’?ArcOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatisthe“average”own-price

elasticityofdemandforprices

inanintervalcenteredonpi’?ArcOwn-PriceElasticityPointOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatistheown-priceelasticity

ofdemandinaverysmallinterval

ofpricescenteredonpi’?Ash?0,PointOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatistheown-priceelasticity

ofdemandinaverysmallinterval

ofpricescenteredonpi’?Ash?0,PointOwn-PriceElasticitypiXi*pi’pi’+hpi’-hWhatistheown-priceelasticity

ofdemandinaverysmallinterval

ofpricescenteredonpi’?Ash?0,PointOwn-PriceElasticitypiXi*pi’Whatistheown-priceelasticity

ofdemandinaverysmallinterval

ofpricescenteredonpi’?Ash?0,PointOwn-PriceElasticitypiXi*pi’Whatistheown-priceelasticity

ofdemandinaverysmallinterval

ofpricescenteredonpi’?istheelasticityatthe

point

PointOwn-PriceElasticityE.g.Supposepi=a-bXi.

ThenXi=(a-pi)/bandTherefore,PointOwn-PriceElasticitypiXi*pi=a-bXi*aa/bPointOwn-PriceElasticitypiXi*pi=a-bXi*aa/bPointOwn-PriceElasticitypiXi*pi=a-bXi*aa/bPointOwn-PriceElasticitypiXi*pi=a-bXi*aa/bPointOwn-PriceElasticitypiXi*api=a-bXi*a/bPointOwn-PriceElasticitypiXi*api=a-bXi*a/ba/2a/2bPointOwn-PriceElasticitypiXi*api=a-bXi*a/ba/2a/2bPointOwn-PriceElasticitypiXi*api=a-bXi*a/ba/2a/2bPointOwn-PriceElasticitypiXi*api=a-bXi*a/ba/2a/2bown-priceelasticown-priceinelasticPointOwn-PriceElasticitypiXi*api=a-bXi*a/ba/2a/2bown-priceelasticown-priceinelastic(own-priceunitelastic)PointOwn-PriceElasticityE.g.ThensoPointOwn-PriceElasticitypiXi*everywherealong

thedemandcurve.RevenueandOwn-PriceElasticityofDemandIfraisingacommodity’spricecauseslittledecreaseinquantitydemanded,thensellers’revenuesrise.Henceown-priceinelasticdemandcausessellers’revenuestoriseaspricerises.RevenueandOwn-PriceElasticityofDemandIfraisingacommodity’spricecausesalargedecreaseinquantitydemanded,thensellers’revenuesfall.Henceown-priceelasticdemandcausessellers’revenuestofallaspricerises.RevenueandOwn-PriceElasticityofDemandSellers’revenueisRevenueandOwn-PriceElasticityofDemandSellers’revenueisSoRevenueandOwn-PriceElasticityofDemandSellers’revenueisSoRevenueandOwn-PriceElasticityofDemandSellers’revenueisSoRevenueandOwn-PriceElasticityofDemandRevenueandOwn-PriceElasticityofDemandsoifthenandachangetopricedoesnotalter

sellers’revenue.RevenueandOwn-PriceElasticityofDemandbutifthenandapriceincreaseraisessellers’

revenue.RevenueandOwn-PriceElasticityofDemandAndifthenandapriceincreasereducessellers’

revenue.RevenueandOwn-PriceElasticityofDemandInsummary:Own-priceinelasticdemand;

pricerisecausesriseinsellers’revenue.Own-priceunitelasticdemand;

pricerisecausesnochangeinsellers’

revenue.Own-priceelasticdemand;

pricerisecausesfallinsellers’revenue.MarginalRevenueandOwn-PriceElasticityofDemandAseller’smarginalrevenueistherateatwhichrevenuechangeswiththenumberofunitssoldbytheseller.MarginalRevenueandOwn-PriceElasticityofDemandp(q)denotestheseller’sinversedemandfunction;i.e.thepriceatwhichthesellercansellqunits.ThensoMarginalRevenueandOwn-PriceElasticityofDemandandsoMarginalRevenueandOwn-PriceElasticityofDemandsaysthattherateatwhichaseller’srevenuechanges

withthenumberofunitsitsells

dependsonthesensitivityofquantity

demandedtoprice;