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Question
Draw a diagram to show the elasticity of demand when it is greater than one.
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Solution
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Demand for basic necessities is inelastic.
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The demand of foodgrains is inelastic.
Fill in the blanks with appropriate alternatives given in the bracket.
Demand elasticity can be measured from demand curve by ___________ method.
The demand for salt is ______.
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Demand for commodity having multiple uses has elastic demand.
State whether the following statement is true or false. Give valid reasons in support of your answer.
The coefficient of price elasticity of demand for the commodity is inversely related to the number of alternative uses of the commodity.
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(−) 3.1, (−) 0.2, (−) 1.1
Assertion (A): Elasticity of demand explains that one variable is influenced by another variable.
Reasoning (R): The concept of elasticity of demand indicates the effect of price and changes in other factors on demand.
Identify the correctly matched pair from the items in Column A by matching them to the items in column B:
| Column A | Column B |
| 1. Increase or decrease in demand for a commodity does not cause any change in its price. | (a) Effect on supply, in the case of Perfectly Elastic Demand. |
| 2. Increase or decrease in demand causes a change in the price of the commodity. Equilibrium quantity remains constant. | (b) Effect on demand, in the case of Perfectly Inelastic Supply. |
| 3. Increase or decrease in demand cause a change in the price of the commodity. Equilibrium quantity remains constant. | (c) Effect on demand, in the case of Perfectly Elastic Supply. |
| 4. Increase or decrease in demand for a commodity does not cause any change in its price. | (d) Effect on supply, in the case of Perfectly Elastic Demand. |
Explain the concept of price elasticity of demand.
Which type of good typically has inelastic demand?
