ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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It measures the responsiveness of the demand for a good to a change in its price.
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When the percentage change in price is greater than the percentage change in quantity demanded, the elasticity of demand is greater than one.
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When a change in price is not accompanied by a change in quantity demanded, the demand is perfectly elastic.
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None of the above
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Detailed explanation-1: -Elasticity of demand explains the degree of responsiveness of demand to change in price-this is the only correct statement among the following since elasticity of demand is calculated by dividing the proportionate change in quantity demanded by the proportionate change in price. Was this answer helpful?
Detailed explanation-2: -Answer and Explanation: The correct option is d. The greater the price elasticity of demand, the greater the responsiveness of quantity demanded to price. The greater the price elasticity of demand, the greater is the ratio of the percentage change in the quantity demanded by the percentage change in the price.
Detailed explanation-3: -The correct answer is: A. Consumers have little time to respond to a price change.
Detailed explanation-4: -Elasticity is an economic measure of how sensitive an economic factor is to another, for example, changes in price to supply or demand, or changes in demand to changes in income. Price elasticity of demand is an economic measurement of how the quantity demanded of a good will be affected by changes in its price.