Question

price of good falls from 8 to 6. demand rises from 100 to 125 . find price elasticity of demand

Answer 1

Explanation:decrease in price =8-6=2

%decrease in price=(2/8)*100=25%

increase in quantity demanded =125-100

=25

%increase in quantity demanded =(25/100)*100=25%

elasticity of demand =

25%/25%=1

(equal to Unity )

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