Elasticty of demand

If two demand curves intersect, at their point of intersection, _________ demand curve will be more elastic.

• flatter

• steeper

When demand for a commodity is perfectly inelastic, an increase in price by 2%, leads to increase in quantity demanded by______.

• 10%

• 0%

• 3%

• 2%

Which one of the following commodities will not have inelastic demand?

• Salt

• Medicine

• Mobile phone

• School uniform

If demand curve is vertical, value of price elasticity of demand is______

• Zero

• less than one

• more than one

• infinity

If the demand curve is rectangular hyperbola, value of price elasticity of demand is:

• 1

• 0

• infinity

• less than one

Slope of the demand curve is zero, its elasticity of demand is__________

• 0

• 1

• infinity

• less than one

Price elasticity of demand of a commodity is -2.5. Price of commodity increased by 20%. What will be the change in quantity demanded?

• Decrease by 50 units

• Increase by 50 units

• Decrease by 8%

• Decrease by 50%

Which of these is not a factor affecting elasticity of demand?

• Nature of good

• Number of uses of the commodity

• Availability of substitute goods

• Quantity of the commodity demanded

When demand is elastic, and there is increase in price of a commodity, quantity demanded falls more than proportionately.

• True

• False

In which of the following case, demand is likely to be more elastic?

• Matchbox for household consumption

• Textbooks for a student

• Medicine for a patient

• Electricity consumption