Explain Ratio method and Geometric method of measuring Price Elasticity of Demand.
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The Geometric methodmeasures the elasticity of demand at different points on the demand curve and is also known as the Point method of measuring the elasticity of demand. ... Elasticity of demand at point C is the ratio between lower segment and upper segment.
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In this method we consider percentage change in quantity demanded and divide it by percentage change in the price of the commodity. The Geometric method measures the elasticity of demand at different points on the demand curve and is also known as the Point method of measuring the elasticity of demand.
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