Question

price of a good Rises by 10% as a result demandforce by 4% find out price elasticity of demand is the demand elastic or inelastic

Answer 1

Dear student,
Elasticity of demand = (-) % change in quantity demanded
​​​​​​ % change in price
=(-) -4%
10%
= (-) -0.4
= 0.4
Since elasticity is less than 1, so demand is inelastic.

NOTE: (-) sign in formula indicates negative relationship between price and demand. It is there to get absolute value of elasticity.
​​​​​​​Regards.