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The Demand of a Commodity, When Measured Through the Expenditure Approach, is Inelastic. a Fall in Its Price Will Result in : (Choose the Correct Alternative) - CBSE (Arts) Class 12 - Economics

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Question

The demand of a commodity, when measured through the expenditure approach, is inelastic. A fall in its price will result in : (choose the correct alternative)

(a) No change in expenditure on it.

(b) Increase in expenditure on it.

(c) Decrease in expenditure on it.

(d) Anyone of the above.

Solution

Decrease in expenditure on it.

Demand for a good is termed inelastic through the expenditure approach when a fall in its price will result in the decrease in expenditure on it. This is because the expenditure is positively related with a price.

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Solution The Demand of a Commodity, When Measured Through the Expenditure Approach, is Inelastic. a Fall in Its Price Will Result in : (Choose the Correct Alternative) Concept: Demand.
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