ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following is NOT an inelastic demand for a product?
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An elasticity of 0.95.
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An elasticity of 0.7.
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An elasticity of 0.
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An elasticity of 1.5.
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Explanation:
Detailed explanation-1: -Elasticity below 1 is classified as relatively inelastic, while above 1 is relatively elastic.
Detailed explanation-2: -What Does a Price Elasticity of 1.5 Mean? If the price elasticity is equal to 1.5, it means that the quantity of a product’s demand has increased 15% in response to a 10% reduction in price (15% / 10% = 1.5).
Detailed explanation-3: -Because 1.25 is greater than 1, the laptop price is considered elastic.
Detailed explanation-4: -The value of 1.6 tells us that this particular product’s price is elastic.
There is 1 question to complete.