Question

what is the original price of a commodity when price elasticity is 0.71 and demand changes from 20 to 15 units and the new price is rs. 10?

Answer 1

The answer to the above question is 6.45.

The demand changes from 20 to 15 units, so the difference of Unit = 5  

As we already know, the Price Elasticity value is = 0.71  

Therefore, the change in Price = 5*0.71 = 3.55  

The old price value is already given as 10  

With the help of the old value, we can compute the original price of a commodity  

Old price = 10

The original value of a commodity = 10 - 3.55 = Rs. 6.45

Answer 2

so, the original price of a commodity will be 15