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Question
From the following state whether the price elasticity of demand is inelastic, relatively elastic, highly elastic or highly inelastic. Give reasons to support your answer.
demand for cigar by a chain smoker
Solution
It is a habitual necessity for the chain smoker. Hence, demand for cigar will be inelastic
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RELATED QUESTIONS
Complete the correlation :
Ratio method : Ed = `(%Delta"Q")/(%Delta"P")` :: ______ : Ed = `"Lower segment"/"Upper segment"`
Ratio method: Ed = `(%Delta"Q") /(%Delta"UP")`:: ______: Ed = `("Lower segment")/ ("Upper segment")`
Complete the correlation:
Ratio method : Ed = `(%Δ Q) / (% Δ P)` :: ______ : Ed = `("Lower segment")/("Upper segment")`
Complete the correlation:
Ratio method : Ed = `(%ΔQ)/(%ΔP)` :: ______ : Ed = `"Lower segment"/"Upper segment"`
The price of a commodity goes up from ₹ 26 to ₹ 30 as a result of which demand falls from 4 units to 2 units, the price elasticity of demand is ______.
If the percentage increase in the quantity of a commodity is smaller than the percentage fall in its price, the coefficient of price elasticity of demand is ______.
When the price of a commodity falls by 80%, the quantity demanded increases by 100%. Find out its price elasticity of demand.
Ed = `100/80 = 1.25`
Study the table given below and state whether demand is elastic or inelastic. Give reasons for your answer.
| Price in (₹) | Total outlay (₹) |
| 5 | 25 |
| 3 | 18 |
With the help of a diagram, explain the condition when Ep = 1.
From the following state whether the price elasticity of demand is inelastic, relatively elastic, highly elastic or highly inelastic. Give reasons to support your answer.
demand for diesel and petrol
