Question

the quantity demanded of a commodity at a price of ruppee 10 per unit is 40units .its price elasticity of demand is -2. the price fall by 2 per unit. calculate the quantity demanded at the new price. ​

Answer 1

$\bf\underline{Given :-}$

Price of commodity (P) = 10

Quantity demanded (Q) = 40

Elasticity of demand (Ed) = (-)2

Change in Price (ΔP) = 2

Change in Quantity demanded (ΔQ) =?

$ed = ( - ) \frac{Δq}{Δp} \times \frac{p}{q} \\ \\ - 2 = ( - ) \frac{Δq}{2} \times \frac{10}{40} = \frac{Δq10}{80} \\ \\ Δq10 = 80 \times 2 \\ \\ Δq = \frac{160}{10} = 16$

After finding out the value of ΔQ, the quantity demanded at new price (Q1) is :-

Q1 = Q + ΔQ = 40 + 16

$\boxed {Q1 = 56 }$ $\bf\green {(Answer)}$