Ask Question
4 March, 01:19

Elasticity provides a guide to both responsiveness of:

a. quantity demanded to a change in price and change in revenue as price changes.

b. Market stability and change in revenue as price changes.

c. Responsiveness of quantity demanded to a change in price and market stability.

d. Technological change and change in revenue as price changes.

+4
Answers (1)
  1. 4 March, 01:37
    0
    The correct answer is option a.

    Explanation:

    Price elasticity of demand measures the change in the quantity demanded of a commodity due to the change in its price.

    The change in quantity demanded and price level affects the total revenue as the total revenue is the product of price and quantity demanded.

    So when the price is elastic then a change in the price level will cause a greater change in quantity demanded and thus in revenue. Similarly, when demand is inelastic a change in the price level will cause a smaller change in quantity demanded and thus revenue.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Elasticity provides a guide to both responsiveness of: a. quantity demanded to a change in price and change in revenue as price changes. b. ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers