{"id":48778,"date":"2024-04-15T22:46:11","date_gmt":"2024-04-15T22:46:11","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=48778"},"modified":"2024-04-15T22:46:11","modified_gmt":"2024-04-15T22:46:11","slug":"calculate-elasticity-of-demand-when-a-60-increase-in-the-price-of-rice-causes-the-amount-of-rice-you-buy-to-fall-by-120","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/calculate-elasticity-of-demand-when-a-60-increase-in-the-price-of-rice-causes-the-amount-of-rice-you-buy-to-fall-by-120\/","title":{"rendered":"Calculate elasticity of demand when a 60% increase in the price of rice causes the amount of rice you buy to fall by 120%"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;2&#8243; option2=&#8221;4&#8243; option3=&#8221;6&#8243; option4=&#8221;8&#8243; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A.<\/p>\n<p>The formula for calculating the elasticity of demand is:<\/p>\n<p>$E_d = \\frac{\\%\\ change\\ in\\ quantity\\ demanded}{\\%\\ change\\ in\\ price}$<\/p>\n<p>In this case, the percentage change in the price is 60%, and the percentage change in the quantity demanded is 120%. So, the elasticity of demand is:<\/p>\n<p>$E_d = \\frac{120\\%}{60\\%} = 2$<\/p>\n<p>This means that the demand for rice is elastic, because a small change in the price causes a large change in the quantity demanded.<\/p>\n<p>Option B is incorrect because the elasticity of demand is not 4. Option C is incorrect because the elasticity of demand is not 6. Option D is incorrect because the elasticity of demand is not 8.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;2&#8243; option2=&#8221;4&#8243; option3=&#8221;6&#8243; option4=&#8221;8&#8243; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-48778","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Calculate elasticity of demand when a 60% increase in the price of rice causes the amount of rice you buy to fall by 120%<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/calculate-elasticity-of-demand-when-a-60-increase-in-the-price-of-rice-causes-the-amount-of-rice-you-buy-to-fall-by-120\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Calculate elasticity of demand when a 60% increase in the price of rice causes the amount of rice you buy to fall by 120%\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;2&#8243; 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