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Question
Price elasticity of demand is defined as the percentage change in the quantity demanded of a commodity divided by the percentage change in the price of that commodity.
Options
True
False
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Solution
This statement is True.
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RELATED QUESTIONS
A consumer buys 18 units of a good at a price of Rs 9 per unit. The price elasticity of demand for the good is (–) 1. How many units the consumer will buy at a price of Rs 10 per unit? Calculate.
A consumer buys 30 units of a good at a price of the Rs10per unit. The price elasticity of demand for the good is (-) 1. How many units will the consumer buy at a price of Rs 9 per unit? Calculate.
Discuss any four factors affecting price elasticity of demand.
State whether the following statements are TRUE or FALSE :
The demand of foodgrains is inelastic.
Draw a diagram to show the elasticity of demand when it is greater than one.
What will be the effect on price elasticity of demand, if the time required to find the substitute product is more.
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 | Relatively Inelastic Demand | (a) | ed > 1 |
| 2 | Relatively Elastic Demand | (b) | ed < 1 |
| 3 | Perfectly Inelastic Demand | (c) | ed = 0 |
| 4 | Perfectly Elastic Demand | (d) | ed = 1 |
Assertion (A) : A change in quantity demanded of one commodity due to a change in the price of other commodity is cross elasticity.
Reasoning (R) : Changes in consumers income leads to a change in the quantity demanded.
The elasticity of demand for school bag will be ______.
Explain the term elasticity of demand.
