Question

A consumers purchase 400 units of a commodity at a price Rs.50 per unit. If the price falls by 20%,he purchase 600units. calculate the elasticity of demand​

Answer 1

Answer:

Given: Q−10,Q

1

=12,P=5,P

1

=4

ΔP=(4−5)=−1,ΔQ=(12−10)=2

E

d

=(−1)

Q

P

∗

ΔP

ΔQ

=(−)

10

5

∗

−1

2

=1

E

d

=1 Unitary elastic demand.

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