Homework Answers
Ans. Price elastic , price inelastic
Price elasticity of demand = %Change in Demand/ %Change in Price
If 1% change in price leads to a more than 1% change (or a signifiacant change) in demand then the demand ia said to be elastic but if 1% change in price leads to a less than 1% change (or relatively little change) in demand then demand for the good is said to be inelastic.
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