“One Direction” and Elasticity

I have to confess that I don’t actually know any One Direction songs but given that they have just completed a sell out tour of New Zealand and reduced teenage girls to levels of hysteria not seen since The Beatles, I thought I would use them to review elasticity as we approach our school exams.

Up on to the interactive whiteboard I popped the following image - two pictures of the band and the four types of elasticity we cover - price, income, cross and price elasticity of supply. I then told my students that two types belong in each category and invited them to figure out which went in to which.

After a bit of discussion we finally got around to what I was looking for - price elasticity of demand and supply the coefficient is not important as the price change causes quantity demanded / supplied to always go in one direction, however income elasticity can be two directions (depending on whether it is a normal or inferior good) as can cross elasticity (for substitutes and complements).

Further discussion could then be had on such issues as the elasticity of demand for their concert tickets and how boy bands from my era (The Jackson 5) were so much better…