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Question
Which statement about the law of demand and elasticity of demand is true?
Options
Law of demand shows how much demand changes; elasticity shows direction only
Both show only the direction of change in demand
Law of demand shows direction; elasticity shows degree of change
Elasticity is unrelated to price changes
MCQ
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Solution
Law of demand shows direction; elasticity shows degree of change
Explanation:
Law of demand indicates whether demand rises or falls when price changes, while elasticity measures the degree of that change.
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