define elasticity of demand ? how do you measure it?
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The price elasticity of demand is measured by its coefficient (Ep). This coefficient (Ep) measures the percentage change in the quantity of a commodity demanded resulting from a given percentage change in its price. Where q refers to quantity demanded, p to price and Δ to change. If EP>1, demand is elastic.
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Price elasticity of demand is a measure used in economics to show the responsiveness, or elasticity, of the quantity demanded of a good or service to increase in its price when nothing but the price changes.
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