Economic Health

Tecnologico de Monterrey
Microeconomic
Ana Laura Leyva Guemez
11/Septiembre/2012
A01113198

Part 1
I chose physicians’ offices because doctors aren’t affected by the economy, at least notunless there is a serious collapse. The supply per capita remains relative stable, just as the demand.
There will always be sick people and the prices of the consults are not going to change . It'soften said that Healthcare is the most recession-proof industry people get sick regardless of what's going on in the economy. Everyone needs medical atention and more in these days where there’re newdiseases and infections that need long term treatmens, therefore more people will study this profession to offer their services. Eventhought the income increases, or if there is a thecnologic shock thegraph will remain the same.
Part 2
Perfectly inelastic demand means that a consumer will buy a good or service regardless of the movement of price. In order for perfectly inelastic demand to exist,there can be no substitutes available. Price elasticity of demand is a measure used in economics to show the responsiveness, or elasticity, of the quantity demanded of a good or service to a change inits price. More precisely, it gives the percentage change in quantity demanded in response to a one percent change in price. In the case of, Physicians' Offices they have a Price elasticity of demand-0.18 meaning that Physicians' Offices price elasticity is inelastic. I would increase the price for business because even if you increased at X percent there are always sick people to treat. Theincome elasticity of demand measures how responsive consumers are to changes in their level of income. It is measured as the ratio of the percentage change in quantity demanded to the percentage changein income. Physicians' Offices are a normal good; therefore the income elasticity of demand is elastic because it is .22. Studies support the idea that Physicians' Offices supply is less elastic in...