ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -d. In your college town, real estate developers are building thousands of new student-friendly apartments close to campus. I you want to pay the lowest rent possible, should you hope that demand for apartments is relatively elastic or relatively inelastic? You hope demand is relatively elastic.

Detailed explanation-2: -Problem : If Neil’s elasticity of demand for hot dogs is constantly 0.9, and he buys 4 hot dogs when the price is $1.50 per hot dog, how many will he buy when the price is $1.00 per hot dog? This time, we are using elasticity to find quantity, instead of the other way around.

Detailed explanation-3: -Answer and Explanation: The housing demand is elastic.

Detailed explanation-4: -Housing demand is income and price inelastic, and appears to fall with household size.

Detailed explanation-5: -1 Hence, the demand for goods or services with many substitutes is highly price elastic; a small increase in the price levels of goods causes consumers to buy its substitutes. For example, the demand for soda is highly price-elastic because of a large number of substitutes.