economics - price elasticity of demand

Question 1

what is Price Elasticity of Demand?

Answer 1

it measures the responsiveness of quantity demanded to changes in the price of goods and services

Question 2

what is PED’s general formula?

Answer 2

percentage change of price

Question 3

what is the first formula of PED?

Answer 3

% change P

Question 4

what is the second formula of PED?

Answer 4

Q1 - Qo 
------------ x 100% 
   Qo
--------------------------
P1 - Po
------------- x 100%
Po

Question 5

what is the third formula of PED?

Answer 5

Q1 - Qo Po
———— x ————–
Qo P1 - Po

Question 6

what is elastic?

Answer 6

when percentage change in quantity demand is more than percentage change in price

Question 7

what is inelastic?

Answer 7

when percentage change in quantity demand is less than percentage change in price

Question 8

give an example of a type of good that is elastic

Answer 8

Luxury good

Question 9

give an example of a type of good that is inelastic

Answer 9

Normal necessities/goods

Question 10

example of a strategy to sell elastic goods

Answer 10

decrease the price

Question 11

example of a strategy to sell inelastic goods

Answer 11

increase the price

Question 12

must all the answers go through the formula be negative?

Answer 12

yes

Question 13

can there be fractions in the answers that go through the formula

Answer 13

no

Question 14

what is the relationship between price and quantity demanded

Answer 14

negative/inverse