1. What is meant by the price elasticity of demand? How is it calculated? What does this particular calculation tell us?

2. Explain the difference between elastic and inelastic. Provide a real-life example of a good or service and describe whether or not demand for this particular good is elastic or inelastic.

3. When is demand perfectly inelastic? When is demand perfectly elastic? Explain the difference between these two terms. Provide examples.

4. Describe the difference between a price effect and a quantity effect. Again, provide real-life examples in your discussion.