Question : Assertion: The concept of elasticity of demand is only applicable to individual consumers.
Reason: Elasticity of demand measures the responsiveness of quantity demanded to changes in price.
Option 1: Both the assertion and reason are correct and related.
Option 2: Both the assertion and reason are correct but not related.
Option 3: The assertion is correct, but the reason is incorrect.
Option 4: The assertion is incorrect, but the reason is correct.
Correct Answer: The assertion is correct, but the reason is incorrect.
Solution : The correct answer is (C) The assertion is correct, but the reason is incorrect.
The assertion is incorrect because the concept of elasticity of demand is not limited to individual consumers. Elasticity of demand is a fundamental concept in economics that applies to both individual consumers and the market as a whole. It measures the responsiveness of quantity demanded to changes in price and helps analyze consumer behavior and market dynamics.
The reason is incorrect because it incorrectly defines elasticity of demand as measuring the responsiveness of quantity demanded to changes in price. While this is one type of elasticity (price elasticity of demand), there are other types of elasticity as well, such as income elasticity of demand and cross elasticity of demand, which measure responsiveness to changes in income and the price of related goods, respectively.
Therefore, the correct evaluation is that the assertion is incorrect, but the reason is incorrect as well.
