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प्रश्न
The nature of a commodity determines its price elasticity of demand. Explain.
How does the nature of a good affect its elasticity of demand?
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उत्तर
Elasticity of demand of a good is influenced by its nature in the following ways:
- When a commodity is a necessity, its demand is generally inelastic (Ed < 1) → food grains, salt, school uniform etc.
- When a commodity is a comfort, its demand is generally unit elastic (Ed = 1) → cooler, TV, mobile phone etc.
- When a commodity is a luxury, its demand is generally elastic (Ed > 1) → car, home theatre, air conditioner etc.
संबंधित प्रश्न
Explain any two factors that affect the price elasticity of demand. Give suitable examples.
How does change in the price of complementary good affect the demand for the given good? Explain with the help of an example.
When price of a commodity falls by Rs 1 per unit, its quantity demanded rises by 3 units. Its price elasticity of demand is (−) 2. Calculate its quantity demanded if the price before the change was Rs 10 per unit.
Choose the correct answer :
Perfectly elastic demand curve is _________.
The government wants to reduce the consumption of good by 10%. The price elasticity of demand for elasticity is -0.4. The government should raise the price of elasticity by ______.
When the price elasticity of demand for a good equals ______.
How does the availability of substitutes of a commodity affect its price elasticity of demand?
State 3 factors which affect price elasticity of demand.
Which statement correctly describes the relationship between postponement and price elasticity?
