📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

  • google app store apple app store
  • ✖

      Question

      In terms of economics, demand would be inelastic when

      A increase in price of samosa leads to increase in total revenue. Correct Answer Incorrect Answer
      B increase in price of samosa leads to decrease in total revenue. Correct Answer Incorrect Answer
      C increase in price of samosa by 10% leads to fall in quantity demanded by 10%. Correct Answer Incorrect Answer
      D None of these Correct Answer Incorrect Answer

      Solution

      Total revenue (Price × Quantity) increases when price is increased only if the percentage change in quantity demanded is less than the percentage change in price. This is the definition of inelastic demand (% change Qd < % change P).

      Practice Next
      ask-question