Question

If the quantity demanded is unchanged as price changes, the coefficient of the price elasticity of demand is __

Answer 1

Answer:

If the elasticity is -2, that means a one percent price rise leads to a two percent decline in quantity demanded. Other elasticities measure how the quantity demanded changes with other variables (e.g. the income elasticity of demand for consumer income changes). Price elasticities are negative except in special cases.

Explanation:

Answer 2

Answer: Zero

Price elasticity of demand is a measurement of the change in the consumption of a product in relation to a change in its price. Expressed mathematically, it is:

Price Elasticity of Demand = Percentage Change in Quantity Demanded / Percentage Change in Price

• Price elasticity of demand is a measurement of the change in consumption of a product in relation to a change in its price.

• A good is elastic if a price change causes a substantial change in demand or supply.

• A good is inelastic if a price change does not cause demand or supply to change very much.

• The availability of a substitute for a product affects its elasticity. If there are no good substitutes and the product is necessary, demand won’t change when the price goes up, making it inelastic.

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