ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Percentage change in income / Percentage change in quantity demand for a good
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Percentage change in quantity demand for a good / Percentage change in income
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Percentage change in supplied for a good / Percentage change in income
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Percentage change in quantity demand for a good / Percentage change in its price
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Detailed explanation-1: -The formula for calculating income elasticity of demand is the percent change in quantity demanded divided by the percent change in income.
Detailed explanation-2: -The formula for calculating income elasticity of demand is: Income elasticity of demand = (Percent change in quantity demanded/the percent change in income).
Detailed explanation-3: -Price elasticity measures the responsiveness of the quantity demanded or supplied of a good to a change in its price. It is computed as the percentage change in quantity demanded-or supplied-divided by the percentage change in price.
Detailed explanation-4: -How to Calculate Price Elasticity. To calculate price elasticity, divide the change in demand (or supply) for a product, service, resource, or commodity by its change in price. That figure will tell you which bucket your product falls into.
Detailed explanation-5: -Use the demand function for quantity You use the demand formula, Qd = x + yP, to find the demand line algebraically or on a graph. In this equation, Qd represents the number of demanded hats, x represents the quantity and P represents the price of hats in dollars.