Question

Let slope of demand curve is (-) 0.6, calculate elasticity of demand when initial price is $ 30 per unit and initial quantity is 100 units of the commodity.
(A) 0.5
(B) 5.55
(C) (-) 0.5
(D) (-) 0.18
​

Answer 1

Answer:

(C) (-) 0.5

Explanation:

Remember that the slope of a line is calculated by dividing the change in the y-axis by the change in the x-axis, or "rise over run."

The "run over rise," or the change in quantity (on the x-axis) divided by the change in price, is used to measure price elasticity (on the y-axis).

we know that, ED=ΔQΔP×PQ

$=\frac{1}{0.6} *\frac{20}{30}$

$=\frac{-20}{18}$

$=\frac{-10}{9}$

$=-0.5$

#SPJ2

Answer 2

Answer

a

Explanation

1 /0.6 * 30/100

= 0.5