ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Price is dependent on the interaction between demand and supply components of a market. Demand and supply represent the willingness of consumers and producers to engage in buying and selling. An exchange of a product takes place when buyers and sellers can agree upon a price.

Detailed explanation-2: -An inelastic demand is one in which the change in quantity demanded due to a change in price is small. If the formula creates an absolute value greater than 1, the demand is elastic. In other words, quantity changes faster than price. If the value is less than 1, demand is inelastic.

Detailed explanation-3: -Normative science: Managerial economics is a normative science. It is concerned with what management should do under particular circumstances. It determines the goals of the enterprise. Then it develops the ways to achieve these goals.

Detailed explanation-4: -Answer: False The slope of the demand curve shows the change in price associated with a 1 unit change in quantity demanded. The elasticity of demand is the percent change of quantity demanded associated with a 1% change in price.