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  • Profit Maximization Condition (MRS = MRT)

Relationship Between Demand Curve Slope and Price Elasticity

A direct mathematical relationship exists between the slope of a firm's demand curve and the price elasticity of demand (ε). This connection is expressed by the formula for the slope of the demand curve, which is slope=−PεQ\text{slope} = -\frac{P}{εQ}. This can be derived from the elasticity formula ε=−PQ×1slopeε = -\frac{P}{Q} \times \frac{1}{\text{slope}}.

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CORE Econ

Economics

Introduction to Microeconomics Course

The Economy 2.0 Microeconomics @ CORE Econ

Ch.7 The firm and its customers - The Economy 2.0 Microeconomics @ CORE Econ

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