Contends that, although most economics students are acquainted with the graphical analysis of the income and substitution effects of a price change, they often fail to appreciate that the same graphs provide information on the income elasticities of the two goods. Illustrates the proof of this concept using mathematical formulae and five graphic…

Contends that, despite ongoing criticism, Allen's arc elasticity formula remains entrenched in the microeconomics principles curriculum. Reviews the evolution and continuing scrutiny of the formula. Argues that the use of the geometric mean offers pedagogical advantages over the traditional arithmetic mean approach. (CFR)