A book seller estimates that if she increases the price of a book from Rs.60 to Rs.67, the quantity of books demanded will decrease from 2,035 to 1,946. The book’s price elasticity of demand is approximately
0.4
0.8
1.0
2.5
-
A discount store has a special offer on CDs. It reduces their price from Rs.150 to Rs.1 00. Suppose the store manager observes that the quantity demanded increases from 700 CDs to 1,300 CDs. What is the price elasticity of demand for CDs?
.8
1.0
1.25
1.50
Read the following data and answer the Question.
A shopkeeper sells gel pen at Rs. 10 per pen. At this price he can sell 120 per month.
After some time, he raises the price to Rs. 15 per pen. Following the price rise:
• Only 60 pens were sold every month.
• The number of refills bought went down from 200 to 150.
• The number of ink pen customers bought went up from 90 to 180 per month.
The cross elasticity of monthly demand for refills when the price of gel pen increase from Rs. lO to Rs.15 is equal to:
0.71
+ 0.25
-0.1
• 0.38
How to solve the problems???
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