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Question
The coefficient of price elasticity of a good is 0.8 its demand will said to be ______.
Options
Elastic
Inelastic
Perfectly elastic
Perfectly inelastic
Solution
Inelastic
Explanation:
If the coefficient of price elasticity of a good is 0.8, its demand is said to be inelastic. This means that the percentage change in quantity demanded is less than the percentage change in price.
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RELATED QUESTIONS
As a result of a 10% fall in price of good X its demand also increases by 10%. The price elasticity of demand for the commodity will be ______.
When the percentage change in demand of a commodity is greater than the percentage change in its price, the demand for the commodity is ______.
If the percentage increase in the quantity demanded of a commodity is less than the percentage fall in its price, then elasticity of demand is ______.
When the percentage change in quantity demanded is equal to percentage change in price, then it is called as ______ demand.
When is the demand for a commodity said to be elastic?
Briefly explain the percentage method of calculating elasticity of demand.
