When economists measure the responsiveness of consumers to changes in price, they are measuring:

GENERAL ECONOMICS

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	the percentage change in price
B	the price elasticity of demand.
C	the price elasticity of supply.
D	income elasticity.

Explanation:

Detailed explanation-1: -The price elasticity of demand (PED) measures the percentage change in quantity demanded by consumers as a result of a percentage change in price. This measurement of price elasticity of demand is calculated by dividing the % change in quantity demanded by the % change in price, represented in the PED ratio.

Detailed explanation-2: -The price elasticity of demand measures the responsiveness of quantity demanded to changes in price; it is calculated by dividing the percentage change in quantity demanded by the percentage change in price.

Detailed explanation-3: -In practical terms, elasticity refers to the responsiveness of the quantity demanded and supplied to changes in price.

Detailed explanation-4: -The price elasticity of demand is the percentage change in the quantity demanded of a good or service divided by the percentage change in the price. The price elasticity of supply is the percentage change in quantity supplied divided by the percentage change in price.

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SSC MTS EXAM

SSC

GENERAL ECONOMICS