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Elastic and Inelastic Demand

If quantity c...

Question

If quantity changes proportionately more than the price, demand is said to be .

A

elastic

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B

unit elastic

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C

perfectly elastic

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D

inelastic

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Solution

The correct option is A elastic
If quantity changes proportionately more than the price, demand is elastic. This implies that the magnitude of elasticity will be greater than 1.

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