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Definition of Elasticity
Is defined as the ratio of the relative change of one (dependent) variable to changes in another (independent) variable, or it's a percentage change of one variable given a one percent change in another.
Elasticity of Demand
Measures the extent to which the quantity demanded of a good responds to changes in one of the factors affecting demand.
Calculate point elasticity of demand for demand function Q=10-2p for decrease in price from Rs 3 to Rs 2.
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Question: (a) As an advisor to government as well as that to a firm how will you make use of your knowledge on price elasticity of demand, income elasticity and cross price ela
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