Question

If there is no change in the quantity demanded of commodity - $X$, what will be the nature of the price elasticity of demand?

Answer 1

$E_d=(-)\frac{P}{Q}\times \frac{△Q}{△P}$
Here, $P=Rs.5;P_1=Rs.4\therefore$ $△P=P_1-P=Rs.4-Rs.5=(-)Rs.1$
$Q=4kg;Q_1=6kg\therefore$ $△Q=Q_1-Q=(6-4)kg=2kg$
Price elasticity of demand $\left(E_d\right)=(-)\frac{5}{4}\times \frac{2}{-1}=\frac{10}{4}$
$=2.5$ (greater than unity)
Price elasticity of demand will be zero. Implying a situation of perfectly inelastic demand.