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प्रश्न
Price elasticity of demand for the two goods X and Y are zero and (–) 1 respectively. Which of the two is more elastic and why?
उत्तर
When the price elasticity of demand for Good Y and Good X are zero and −1, respectively, the elasticity of demand is less than unity, i.e. Ed < 1. It is a situation of inelastic demand. Here, the demand of Good Y is perfectly elastic compared to Good X. When the price elasticity of demand for Good Y is zero, it implies that Good Y is perfectly inelastic compared to Good X.
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संबंधित प्रश्न
A consumer spends Rs 1,000 on a good priced at Rs10 per unit. When its price falls by 20 percent, the consumer spends Rs800 on the good. Calculate the price elasticity of demand by the Percentage method
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Discuss any four factors affecting price elasticity of demand.
8 units of a good are demanded at a price of Rs 7 per unit. Price elasticity of demand is (−) 1. How many units will be demanded if the price rises to Rs 8 per unit? Use expenditure approach of price elasticity of demand to answer this question.
State whether the following statement isTrue or False with reason:
The concept of elasticity of demand is useful in economic theory.
Give reasons or explain the following statements
Demand for basic necessities is inelastic.
What do you mean by a normal good?
What do you mean by substitutes? Give examples of two goods which are complements of each other.
Give reason or explain the following statement.
All desires are not demand.
Fill in the blank with appropriate alternatives given below:
Income elasticity of demand for inferior goods is __________.
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Perfectly inelastic demand curve is parallel to the X axis.
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Unitary Elastic Demand
Give reason or explain the following statement:
Demand for habitual goods is inelastic.
Arrange the following coefficients of price elasticity of demand in ascending order:
(−) 3.1, (−) 0.2, (−) 1.1
The concept of elasticity of demand was introduced by
Elasticity of the demand is available when:
Identify the correctly matched pair from the items in Column A by matching them to the items in column B:
| Column A | Column B |
| 1. Increase or decrease in demand for a commodity does not cause any change in its price. | (a) Effect on supply, in the case of Perfectly Elastic Demand. |
| 2. Increase or decrease in demand causes a change in the price of the commodity. Equilibrium quantity remains constant. | (b) Effect on demand, in the case of Perfectly Inelastic Supply. |
| 3. Increase or decrease in demand cause a change in the price of the commodity. Equilibrium quantity remains constant. | (c) Effect on demand, in the case of Perfectly Elastic Supply. |
| 4. Increase or decrease in demand for a commodity does not cause any change in its price. | (d) Effect on supply, in the case of Perfectly Elastic Demand. |
Assertion (A) : A change in quantity demanded of one commodity due to a change in the price of other commodity is cross elasticity.
Reasoning (R) : Changes in consumers income leads to a change in the quantity demanded.
Explain the term elasticity of demand.
