Sandeep Garg Macroeconomics Class 12: Chapter 4 Elasticity of Demand

Sandeep Garg Class 12 Microeconomics Solutions Chapter 4 Elasticity of Demand is explained by the expert Economics teachers from the latest edition of Sandeep Garg Microeconomics Class 12 textbook solutions. We at BYJU’S provide Sandeep Garg economics class 12 Solutions to give comprehensive insight about the subject to the students. These insights help as a priceless benefit to students while completing their homework or while studying for their exams. There are numerous concepts in economics, however, we at BYJU’S provide the students with the solution from Elasticity of Demand, which will be useful for the students to score well in the board examinations.

Sandeep Garg Solutions Class 12 – Chapter 4 – Part A – Microeconomics

Question 1

What is the Elasticity of Demand?

Ans: Elasticity of Demand refers to the percentage change in demand for a commodity with respect to the percentage change in demand for a commodity with respect to the percentage change in any of the factors affecting demand for that commodity.

Question 2

How is the Elasticity of Demand calculated?

Ans: \(\frac{Percentage\, change\, in\, demand\, for\, X}{Percentage\, change\, in\, a\, factor \, affecting\, the\, demand\, for\, X}\)

Question 3

What are the 5 Degrees of Elasticity of Demand?

Ans: 5 types of price elasticities of demand are:

  • Perfectly elastic demand
  • Perfectly inelastic demand
  • Highly elastic demand
  • Less elastic demand
  • Unitary elastic demand

Question 4

What are the factors that affect the price elasticity of demand?

Ans: Factors affecting the price elasticity of demand are:

  • Nature of commodity
  • Availability of substitutes
  • Income level
  • Level of price
  • Number of uses
  • Time period
  • Habits

Students can also refer Demand

Question 5

The demand for a good falls to 240 units in response to the rise in price by ₹.2. If the original demand was 300 units at the price of ₹.20, calculate the price elasticity of demand.

New Quantity (\(_{Q_{1}}\)) = 240 Units

Rise in Price (\(\triangle P\)) = ₹2

Original Quantity (Q) = 300 Units

Original Price = ₹ 20

Change in Quantity (\(\triangle Q\)) = -60 Units New Price (\(_{P_{1}}\)) = ₹ 22
Elasticity of demand \(^{_{E_{d}}}\) = ?
\(Price\, elasticity\, of\, Demand\, _{E^{_{d}}} = \frac{\triangle Q}{\triangle P}\times \frac{P}{Q}=\frac{-60}{2}\times \frac{20}{300}=\left (- \right )2\)

Solution:

\(_{E_{d}}=\left (-\right )2 \left ( Demand\, is \, highly\, elastic \, as\, {E_{d}} >\, 1\right )\)

State whether the following statements are true or false.

Question 6

A commodity with a large number of close substitutes shows high elasticity of demand.

Ans: True

Question 7

In the case of the horizontal straight line demand curve, demand does not change even with the change in price.

Ans: False

The above-provided solutions are considered to be the best solution for ‘Sandeep Garg Microeconomics Class 12 Solutions Chapter 4 Elasticity of Demand’. Stay tuned to BYJU’S to learn more.

Leave a Comment

Your email address will not be published. Required fields are marked *