薄利多销.ppt

Chapter 4: Elasticity 薄利多銷? Total expenditure (Total sales) = P × Q Total Cost = direct cost + indirect cost Profit = Total sales - Total Cost 薄利 implies lowering price 多銷 means more sales 嚴刑重罰 Or 寓禁於徵 ? What do you think? Could reducing the supply of illegal drugs cause an increase in drug-related burglaries? The Effect of Extra CustomPatrols on the Market for Illicit Drugs Using Price Elasticity of Demand: The War on Drugs Every year U.S. Government spends about $20 billion on efforts to restrict the supply of drugs Figure (a) Market for heroin without government intervention Figure (b) Result of government efforts to restrict supply (current policy) Figure (c) Results of an effective policy of reducing demand 3 conditions in the War on Drugs Price Elasticity of Demand Elasticity A measure of the extent to which quantity demanded and quantity supplied respond to variations in price, income, and other factors. 中文定義: 對價格之敏感度 Price Elasticity of Demand Defined Generally A measure of the responsiveness of the quantity demanded of a good to a change in the price of that good Formally The percentage change in the quantity demanded that results from a 1 percent change in its price Price Elasticity of Demand Measuring Price Elasticity of Demand Price Elasticity of Demand Assume The price of pork falls by 2% and the quantity demanded increases by 6% Then the price elasticity of demand for pork is Price Elasticity of Demand Measuring Price Elasticity of Demand Price Elasticity of Demand Measuring Price Elasticity of Demand Elastic and Inelastic Demand Price Elasticity of Demand What is the elasticity of demand for pizza? Originally Price = $1/slice Quantity demanded = 400 slices/day New Price = $0.97/slice Quantity demanded = 404 slices/day, then Price Elasticity of Demand What is the elasticity of season ski passes? Originally Price = $400 Quantity demanded = 10,000 passes/year New Price = $380 Quantity demanded = 12,000 passes/year, then D