Calculate the price elasticity of demand for the good, if demand for the good reduces by 4% due to the rise in price by 20%.
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Answer:
Calculate the price elasticity of demand for the good, if demand for the good reduces by 4% due to the rise in price by 20%.
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2
Answer:
0.2%
Explanation:
Price Elasticity of demand = % Change in Quantity Demanded divided by % Change in Price.
% Change in Demand = 4%
% Change in Price = 20%
Therefore, answer is 0.2%
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