Elasticity of Demand – Price, Income, and Cross-Price

This video covers the following learning objectives:

✔ Calculate and interpret price, income, and cross-price elasticities

Specifically addressed through:

• Definition, interpretation, and calculation of Price Elasticity of Demand (PED)

• Practical example with data table and step-by-step PED calculation

• Excel demonstration opportunity for calculating and visualizing PED

• Exploration of factors that influence elasticity (substitutes, necessity, time horizon)

• Definition, interpretation, and calculation of Income Elasticity of Demand (YED) with a real-world example

• Definition, interpretation, and calculation of Cross-Price Elasticity of Demand (XED) to distinguish substitutes and complements

• CFA-style multiple-choice question reinforcing cross-price and income elasticity interpretation