as the prie of a ommodity rises from 10 to 12,its demand falls from 100 units to 50 units.calculate elasticity of demand.
a).4 b).3
c).1 d).2
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Pl work out my problems
Replies (2)
Elasticity of demand = (% change in Demand / % change in price)
Here % change in Demand = (50-100/100)*100 = -50%
% change in Price = (12-10/10)*100 = 20%
EOD = 50% / 20% = -2.5
So i think the correct answer is not provided in the options..........
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