Explain percentage method of measuring price elasticity of demand ?
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✨ᴛʜᴇ ᴘʀɪᴄᴇ ᴇʟᴀsᴛɪᴄɪᴛʏ ᴏғ ᴅᴇᴍᴀɴᴅ ɪs ᴍᴇᴀsᴜʀᴇᴅ ʙʏ ɪᴛs ᴄᴏᴇғғɪᴄɪᴇɴᴛ (ᴇᴘ). ᴛʜɪs ᴄᴏᴇғғɪᴄɪᴇɴᴛ (ᴇᴘ) ᴍᴇᴀsᴜʀᴇs ᴛʜᴇ ᴘᴇʀᴄᴇɴᴛᴀɢᴇ ᴄʜᴀɴɢᴇ ɪɴ ᴛʜᴇ ǫᴜᴀɴᴛɪᴛʏ ᴏғ ᴀ ᴄᴏᴍᴍᴏᴅɪᴛʏ ᴅᴇᴍᴀɴᴅᴇᴅ ʀᴇsᴜʟᴛɪɴɢ ғʀᴏᴍ ᴀ ɢɪᴠᴇɴ ᴘᴇʀᴄᴇɴᴛᴀɢᴇ ᴄʜᴀɴɢᴇ ɪɴ ɪᴛs ᴘʀɪᴄᴇ. ɪғ ᴇᴘ< 1, ᴅᴇᴍᴀɴᴅ ɪs ɪɴᴇʟᴀsᴛɪᴄ, ᴀɴᴅ ᴇᴘ= 1, ᴅᴇᴍᴀɴᴅ ɪs ᴜɴɪᴛᴀʀʏ ᴇʟᴀsᴛɪᴄ.❤
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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. ... If EP< 1, demand is inelastic, and Ep= 1, demand is unitary elastic.
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