Question

as price of commodity increase from rs. 4 per unit rs. 5 per unit, demand falls from 20 units to 10 units find out the elasticity of demand ​

Answer 1

Answer:

2 ( perfectly elastic)

Explanation:

Original quantity (q) = 20

change in quantity (∆q) = 20-10= 10

Original price (p) = 4 per unit

change in price (∆p) = 5-4 = 1

we use price elasticity formula

• Ep = ∆q/∆p × p/q
• 10/1 × 4/20
• 2

elasticity of demand is 2