Elastic Supply

Ego – According to Freudian theory, the ego is one prong of the three parts of the personality. The ego is the executive, or the planner, compromising between the demands for immediate gratification of the id and the pristine rigidity of the superego (conscience or moral self).

Ego Defenses – The tools the ego has available to defend the individual from psychological stresses such as the forces of the id (libido) and the superego. Ego defenses are psychological constructs such as identification, rationalization, reaction formation, repression, sublimation, etc.

Ego-Defensive Function of Attitudes – The protection of the individual self provided by attitudes. The ego defensive function protects the individual from the threats by concealing the “true” self and any socially undesirable feelings and wants. It is one of the functions of attitudes proposed by the functional theory of attitudes.

Eighty-Twenty Principle – The situation in which a disproportionately small number (e.g., 20 percent) of salespeople, territories, products, or customers generate a disproportionately large amount (e.g., 80 percent of a firm’s sales or profits. This phenomenon can be identified and addressed by conducting a sales analysis and cost analysis.

Elaboration – The degree of elaboration determines the number of meanings or beliefs formed during comprehension.

Elaboration Likelihood Model (ELM) – A model attitude formation and change that proposes that the process by which attitudes depends upon the message recipient’s level of motivation. According to petty and Cacioppo, the authors of the ELM, when motivation is high, the message recipient will pay attention and respond to the quality of message arguments. When motivation is low, the message recipient will be more responsive to peripheral elements of the message (e.g., music, spokesperson, attractiveness, etc.)

Elastic Demand – 1. A situation in which a cut in price increases the quantity taken in the market enough that total revenue is increased. 2. A situation in which a given change in price of an economic good is associated with a more than proportionate change in the quantity that the buyers would purchase. 3. A situation in which the percentage of quantity taken “stretches” more than the percentage drop in price.

Elastic Supply – 1. A situation in which percentage increase in price attracts a greater percentage of products offered to the market. 2. A situation in which the percentage of goods offered “stretches” more than the percentage increase in price.

Elasticity – The degree that an economic variable changes in response to a change in another economic variable.

Elasticity – The degree that an economic variable changes in response to a change in another economic variable.

Elasticity Coefficient – 1. A measure of the responsiveness of the quantity of a product taken in the market to price changes. 2. (technical definition) E is the limit as the change in price tends to zero of a ratio composed of two ratios: the change in quantity/quantity, divided by change in price/price. E is always negative: if the absolute value of E is greater than one, demand is said to be elastic; if exactly equal to one, unitary price elasticity prevails; if less than one, demand is said to be inelastic.

Elasticity of Expectation – A measure of the changes in prices of goods and changes in the quantity taken by the market stemming from expectations by consumers.

Elasticon – A conjoint analysis-based model for estimating self-and cross price elasticity. Subjects are asked to indicate their likelihood of buying each brand (when each brand is priced at some experimental level). A first order Markov model represents the price induced brand switching. The price demand model is fitted by generalized least-squares to the share of choices.

Electronic Data Interchange (EDI) – 1. (physical distribution definition) The inter company, application-to-application exchange of business transactions in a standard data format. 2. (retailing definition) The inter firm computer-to-computer transfer of information, as between or among retailers, wholesalers, and manufacturers.

Electronic Fund Transfer – The use of electronic means, such as computers, telephones, magnetic tape and so on, rather than checks, to transfer funds, or to authorize or complete a transaction. This development has given rise to the concept of the cashless economy.

Elimination-By-Aspects (EBA) Model – A brand choice model that represents the ultimate selection decision as a series of eliminations. Each alternative available for choice is viewed as having some set of aspects (e.g., product features). At each stage of the choice process an aspect is selected (with probability proportional to that aspect’s importance for this consumer), and all alternatives still being considered that do not posses the selected aspect are eliminated. The process continues until only one alternative remains, and that remaining item is assumed to be one chosen by the consumer. (Tversky 1972). Although more difficult to calibrate and apply than Luce’s Choice Axiom model for choices, it does avoid the the independence from irrelevant alternatives property of of the latter model, which is often seen as an appealing feature of the EBA model. It has led to the development of other hierarchical/sequential choice models, including the Hierarchical elimination Model (Tversky and Sattah 1979) and Generalized Elimination Model (Hausser 1986).

Embargo – The prohibition of shipment of goods or services to designated countries.

Emergency Product – A good 9such as a portable generator) or a service (such as ambulance delivery) in which an essentially non deliberative purchase decision is based on critically and timely need.

Employee Discount – A certain discount from retail price offered by most general merchandise retailers to employees. It is a kind of retail reduction from the point view of accounting. Usually stores grant a larger percentage on personal wearing apparel than on gifts purchased by the employee.

Emulative Product – A new product that imitates another product already on the market. It is somewhat different from previous products (not a pure “me too” product), but the difference is not substantial or significant.

End of the Month Dating (EOM) – The cash discount and the net credit periods begin on the first day of the following month rather than on the invoice date.EOM terms are frequently stated in this manner: “2/10, net 20, EOM.” Suppose an order is filled and shipped on June 16 under these terms. In such a case, the cash discount may be taken anytime through July 10 and the net amount is due 0n July 30.

End Sizes – Those sizes that are usually large, small or extraordinary in some respect.

End User – A person or organization that consumes a good or service that may consist of the input of numerous firms. For example, an insurance company may be the end user for a keyboard for a personal computer, originally produced for and sold to the personal computer manufacturer.

End-Aisle Display – An exhibit of a product set up at the end of the aisle in a retail store to call attention to a special offering or price.

Endless Chain Method – A method of prospecting in which a salesperson asks customers to suggest other customers who might be interested in the salesperson’s offerings.

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