Question

# On the basis of graph given above answer next 5 questions.At curve D $$D_2$$ elasticity is __________.

A
Ed>1
B
Ed<1
C
Ed=1
D
Ed=

Solution

## The correct option is A $$E_d\,>\,1$$In the given curve x-axis shows quantity and y-axis shows price.$$\Rightarrow$$  In given curve $$DD_2$$, we can see its  line where quantity of demand and price changes .$$\Rightarrow$$  The price elasticity of demand is the percentage change in the quantity demanded of a good or service divided by the percentage change in the price.$$\Rightarrow$$  At curve $$DD_2$$ a product or service's demanded quantity changes by a greater percentage than changes in price.$$\Rightarrow$$   $$E_d=\dfrac{\%change\,in\,quantity}{\%change\,in\,price}$$Here,% Change in quantity $$>$$% Change in price.$$\therefore$$ $$E_d>1$$Maths

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