wherdemand is described as q - Note: An alternate notation for this equation is E(p)- f(p), in other words, quantity is a function of price. You may use whichever form of this equation for elasti...

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Question

business economics

Answer 1

Answer #1

3. Fill in the blank: a. If E(P)<1 demand is called inelastic demand b. IfE(P)> 1 demand is called elastic demand the elastic

When % change in demand is less than the % change in price, then demand is inelastic and absolute value of elasticity is less than 1.

When % change in demand is more than the % change in price, then demand is elastic and absolute value of elasticity is more than 1.

When % change in demand is equal to the % change in price, then demand is unitary elastic and absolute value of elasticity is equal to 1.

Answer 2

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