ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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0.47
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0.02
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250
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2.14
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Detailed explanation-1: -The demand for Kelloggs Corn Flakes is very elastic because consumers have many other options that are near-perfect substitutes. This means that consumers will likely switch to these substitutes if the price rises even a little.
Detailed explanation-2: -The price rises from $125 to $135 a pair. $125)/$130] × 100, which is 7.7 percent. The elasticity of supply equals (25.0 percent/7.7 percent), which is 3.25.
Detailed explanation-3: -Answer and Explanation: The correct option is b.-2. Thus, it can be stated that the elasticity of demand is-2.
Detailed explanation-4: -Calculate the elasticity of demand when the price rises from $4 to $6 a pen. Over what price range is the demand for pens elastic? The price elasticity of demand is 0.72. When the price of a pen rises from $4 to $6, the quantity demanded of pens decreases from 80 to 60 a day.