Question

4. A certain quantity of the commodity is purchased when its price is 10 per unit. Quantity demanded
increases by 50 per cent in response to a fall in price by 2 per unit. Find elasticity of demand.
(Ans. Es = 2.5)
CET
TA
11​

Answer 1

Answer: Ed = 2.5

Explanation: first of all calculate percentage change in price. Then fill values i

Formula. Like

Answer 2

The elasticity of demand = 2.5

GIVEN:- Price¹ = 10; Change in price = fall in price by 2 per unit; Quantity demanded increases = 50%

TO FIND:- elasticity of demand.

SOLUTION:-

• Elasticity Of Demand is the ratio of the percentage change in Quantity to the percentage change in price.
• Change in price = 2 (given)
• Change in quantity = 50%

Percentage change in price = Change in price by initial price multiplied by 100

$= \frac{2}{10} \times 100 \\ = \frac{2}{10} \times 100 \\ = 20\%$

Elasticity Of Demand =

$\frac{\% \: change \: in \: q}{\% \: change \: in \: p}$

$= \frac{50}{20} \\ = 2.5$

Hence, the elasticity of demand = 2.5

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