Elasticity

Question 1

What does PED stand for?

Answer 1

Price Elasticity of Demand

Question 2

What does PES stand for?

Answer 2

Price Elasticity of Supply

Question 3

What does Price Elasticity of Demand

Answer 3

Price Elasticity of Demand (PED) measures responsiveness of demand as a result of a change of price

Question 4

The formula for PED

Answer 4

Change in Quality Demanded / Change in price.

Question 5

A local pizza restaurant lowers their price from £15 to £13.20. They notice demand increase from 100 to 150 pizzas.​

calculate the PED

Answer 5

The answer is -4.17

Change in sales = 50%

Change in price = -12%

Question 6

What determines if PED is Price Elastic?

Answer 6

If it is higher than 1

Question 7

What determines if PED is Price Inelastic

Answer 7

If it is lower than 1

Question 8

What determines if PED is in Unitary Price Elasticity

Answer 8

If it is equal to 1

Question 9

If the PED of a product is -1.5 and price decreases, sales will decrease.

True or False

Answer 9

False

Question 10

If the PED of a product is -1.5 and price decreases, sales will increase significantly.
True Or False

Answer 10

True