Explain the way of Price Elasticity of Demand
Explain the way of Price Elasticity of Demand.
Expert
Price Elasticity of Demand can be measured as given below:
Price Elasticity = Proportionate change in quantity demanded/Proportionate change in price OR
Ep = (Change in Quantity demanded / Quantity demanded)/ (Change in Price/price)
Ep = ((Q2-Q1)/Q1)/((P2-P1) /P1),
Here: Q1 stands for Quantity demanded before price change Q2 stands for Quantity demanded after price change P1 stands for Price charged before price change P2 stands for Price charge after price change.
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