Question

Mr. Ram spent ₹200 on a commodity and bought 20 units of it. When its price changed, he spent
₹300 and bought 15 units. Find out the elasticity of demand.​

Answer 1

Given :-

  P = Rs.200              Q = 20units

  P1 = Rs.300             Q1 = 15units

Solution :-

    Ed = change in Qty / Change in Price   x     Price / Qty

         = -5 / 100 x  200 / 20

         = -5 / 10  

         =  -1 / 2

         = - 0.5

therefore, Elasticity of demand is -0.5.

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