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प्रश्न
Price elasticity of demand of good X is −2 and of good Y is −3. Which of the two goods has more price elasticity and why?
उत्तर
- Mathematically, −2 > −3.
- But in the context of price elasticity of demand, the minus sign indicates only an inverse relation between price and demand. It does not affect the value of elasticity. Hence, −3 > −2.
The value of Ed = −3 implies
that change in demand is 3 times
the change in price, while
Ed = −2 implies
that change in demand is 2 times
the change in price. - Therefore, demand of good Y is more elastic because one percent change in price results in a higher percentage change in demand.
संबंधित प्रश्न
What is meant by price elasticity of demand?
Give economic terms:
Degree of responsiveness of a change in quantity demanded of one commodity due to a change in the price of another commodity.
Assertion (A): A change in quantity demanded of one commodity due to a change in the price of another commodity is cross elasticity.
Reasoning (R): Changes in consumer income lead to a change in the quantity demanded.
Degree of responsiveness of a change in quantity demanded to a change in the income of the consumer −
Distinguish Between
Price elasticity of demand and Income elasticity of demand
Explain the types of elasticity of 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.
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.
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.
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.
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.
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.
Read the extract given below and answer the questions.
|
The Economic Times - 2024 “Lakshadweep becomes new keyword for investors. Praveg caught shareholder’s attention as it had last month received a work order for the development of operation, maintenance and management of atleast 50 tents at Lakshadweep’s island. The resorts will also offer commercial activities like scuba diving, destination weddings, corporate functions etc. Small cap soars 43% in 3 days. It is known for its luxury resorts in tourist places. During the day the stock rallied 17% to hit an all time high of Rs. 1,187.95" |
- What commercial activities would the resorts offer?
- State the quality of a factor of production highlighted above.
- Define price elasticity of demand.
- State the doctrine of Laissez faire.
If commodity X and Y are complementary goods , what will be the cross elasticity of demand?
If prices of salt and coffee increase by the same proportion, will their quantity demanded behave in the same manner? Explain by giving reasons.
Why is price elasticity of demand negative?
What is meant by cross elasticity of demand?
