Advertisements
Advertisements
Question
Calculate elasticity of demand on the basis of the following data.
| Price (Rs.) | Quantity (Kg) |
| 10 | 20 |
| 20 | 15 |
- Calculate the elasticity of demand.
- Is the demand elastic or inelastic?
Solution
(a)
Ed = `(ΔQ)/(ΔP)xxP/Q`
Here, ΔQ = 5, ΔP = 10
Q = 20, P = 10
By putting these values:
Ed = `5/10xx10/20`
= `1/4`
= 0.25
(b)
Demand here is less elastic.
APPEARS IN
RELATED QUESTIONS
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.
Distinguish between:
Income Elasticity of Demand and Cross Elasticity of Demand
With the help of a diagram, explain the Relatively inelastic demand curve.
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.
Price elasticity of demand measures ______.
With the help of a diagram, explain the Relatively elastic demand curve.
How is the price elasticity of demand of a commodity is affected by the number of its substitutes.
