when the price of a commodity falls from rs.8 per unit to rs.7 per unit total expenditure on it increases from rs.200 to 210 . calculate it's price elasticity of demand.
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Answered by
1
Answer:
The Formula for the Arc Price Elasticity of Demand Is ... an increase in quantity demanded from 40 to 60 units, then the price elasticity ... The arc elasticity of demand can be calculated as:.
Answered by
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Answer:
Price (Rs.) Total Expenditure (Rs.) Quantity Demanded (Units)
4
3 200
300
4
200
=50
3
300
=100
Change in Price Percentage Change in Price Change in Demand Percentage Change in Demand
Rs.4 to Rs.3
4
3−4
×100=−24% 50 units and 100 units
50
100−50
×100=100%
Price elasticity of demand (E
d
)=(−)
Percentage change in price
Percentage change in quantity demanded
=(−)
−25%
100%
=4.
Price elasticity of demand =4
Explanation:
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