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Questions › JNU › JNU SIS 2012 › Q6
4 marks, −1Microeconomics › Demand theory and elasticity › Price elasticity of demandEasyabout 1 min

JNU SIS 2012 Question 6: Demand theory and elasticity

Suppose the elasticity of demand for an iPod is −3⋅5-3\cdot 5−3⋅5. This means that

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Plain-text version

Suppose the elasticity of demand for an iPod is -3· 5. This means that (A) the demand for iPods is inelastic (B) the demand curve for iPods is very steep. (C) 10 percent increase in the price of iPods will cause quantity demanded to rise by 35%. (D) 10 percent increase in the price of iPods will cause quantity demanded to fall by 35%.

Also written as: Suppose the elasticity of demand for an iPod is -3* 5. This means that

Demand theory and elasticity has come up 161 times in 7 exams since 2004.

What this question tests

This question is on Price elasticity of demand, part of Demand theory and elasticity in Microeconomics.

How responsive quantity is to price, at a point, along a linear curve, and for constant-elasticity demand.

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