Price of a commodity falls from RS 4 to RS 3 per unit . As a result total expenditure on it rises from RS 200 to RS 300. Find out price elasticity of demand by percentage method.

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Old price = ?4. New price=3
Expenditure = p*q
Expenditure increase from 200 to 300.
For old price for ner price
E= p*q. E=p*q
200=4*q. 300=3*q
Q=200/4. Q=300/3
Q=50. Q=100
Now quantity is increase from 50 to 100. Now apply the formula
Ed=(ch in q *100/ q)/(ch in p *100/ p )
=(50*100/50)/( -1*100/4)
Ed = -4

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With regards

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Don't know
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