ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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0.5
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4
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-0.75
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0.25
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2.5
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Detailed explanation-1: -When the price of canned pickle juice increased 50%, percent, the quantity supplied of pickle juice increased 40%, percent. What is the price elasticity of supply, and how is that value interpreted? Reason: A price elasticity of supply less than 1 indicates that supply is inelastic.
Detailed explanation-2: -19. When the price of jackfruit decreased 50%, percent, total revenues earned by jackfruit sellers decreased. What can be concluded based on this information? The demand for jackfruit is price inelastic.
Detailed explanation-3: -If a firm lowers its price and its total revenue increases as a result, this means that the percent change in quantity demanded is greater than the percent change in the price. Because the quantity demanded is changing more than the change in price, the demand curve is elastic.