{"id":54342,"date":"2024-04-16T00:08:33","date_gmt":"2024-04-16T00:08:33","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=54342"},"modified":"2024-04-16T00:08:33","modified_gmt":"2024-04-16T00:08:33","slug":"if-the-demand-for-a-commodity-is-inelastic-an-increase-in-its-pice-will-cause-the-total-expenditure-of-the-consumers-of-the-commodity-to","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/if-the-demand-for-a-commodity-is-inelastic-an-increase-in-its-pice-will-cause-the-total-expenditure-of-the-consumers-of-the-commodity-to\/","title":{"rendered":"If the demand for a commodity is inelastic, an increase in its pice will cause the total expenditure of the consumers of the commodity to"},"content":{"rendered":"

[amp_mcq option1=”Remain the same” option2=”Increase” option3=”Decrease” option4=”Any of the above” correct=”option2″]<\/p>\n

The correct answer is: B. Increase<\/strong>.<\/p>\n

The demand for a commodity is inelastic when the quantity demanded does not change much in response to a change in price. In other words, consumers are not very sensitive to changes in price. When the price of an inelastic good increases, consumers will still buy a relatively large amount of it. This means that the total expenditure of the consumers of the commodity will increase.<\/p>\n

For example, let’s say that the demand for gasoline is inelastic. If the price of gasoline increases by 10%, consumers will not buy much less gasoline. They may drive less, but they will still need to buy gasoline to get to work, school, and other places. This means that the total expenditure of the consumers of gasoline will increase, even though the price has increased.<\/p>\n

On the other hand, if the demand for a commodity is elastic, the quantity demanded will change a lot in response to a change in price. In other words, consumers are very sensitive to changes in price. When the price of an elastic good increases, consumers will buy much less of it. This means that the total expenditure of the consumers of the commodity will decrease.<\/p>\n

For example, let’s say that the demand for movie tickets is elastic. If the price of movie tickets increases by 10%, consumers will buy much fewer movie tickets. They may go to the movies less often, or they may watch movies at home instead. This means that the total expenditure of the consumers of movie tickets will decrease, even though the price has increased.<\/p>\n","protected":false},"excerpt":{"rendered":"

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