as the price of a commodity 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
as the price of a commodity 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
A IS THE ANSWER.
% CHANGE IN QTY/% CHANGE IN PRICE.
=20/50 =0.4
The Price Elasticity of Demand (commonly known as just price elasticity) measures the rate of response of quantity demanded due to a price change. The formula for the Price Elasticity of Demand (PEoD) is:
PEoD = (% Change in Quantity Demanded)/(% Change in Price)
The answer to the question you have given is 2.5.
The Price elasticity shows that demand is Price Elastic (sensitive to price changes).
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As we know that in today’s world everything is so expensive that are not affordable for the rich as well as poor’s. We can see on essay writing the price of everything whether they are cheap or not.
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