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Question : The elasticity of demand for price is:

Option 1: Elasticity = Percentage change in demand/Percentage change in time

Option 2: Elasticity = Percentage change in price/Percentage change in demand

Option 3: Elasticity = Percentage change in demand/Percentage change in supply

Option 4: Elasticity = Percentage change in supply/Percentage change in price


Team Careers360 7th Jan, 2024
Answer (1)
Team Careers360 21st Jan, 2024

Correct Answer: Elasticity = Percentage change in price / Percentage change in demand


Solution : The correct answer is Elasticity = Percentage change in price/Percentage change in demand .

Price elasticity of demand measures how responsive customer demand is to changes in the product's pricing. It is calculated using the formula: Elasticity = Percentage change in price/Percentage change in demand. Other elasticities measure how the quantity demanded changes with other variables such as consumer income.

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