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Question
If the percentage increase in the quantity demanded of a commodity is less than the percentage fall in its price, then elasticity of demand is ______
Options
> 1
= 1
< 1
= 0
MCQ
Fill in the Blanks
Solution
If the percentage increase in the quantity demanded of a commodity is less than the percentage fall in its price, then elasticity of demand is < 1.
Explanation:
Because the percentage change in quantity requested is smaller than the price change. It is somewhat inelastic since its elasticity is less than one.
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