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Topic - ELASTICITY OF DEMAND PDF
Topic - ELASTICITY OF DEMAND PDF
Topic - ELASTICITY OF DEMAND PDF
DEMAND
submitted to- Dr. Anupreet kaur mavi
Submitted by – 1. shikha patial
2. shilpa goel
Content
1. Meaning of price elasticity
2. Types of elasticity of demand
3. Meaning of price elasticity of demand
4. Types of price of elasticity of demand
5. Methods of measuring of price elasticity of
demand
MEANING OF ELASTICITY OF
DEMAND-
6 1 6 PED =
I
5 2 10 10/6, > 1
4 3 12
PED =
II
3 4 12 12/12, = 1
2 5 10
PED =
III
1 6 6 6/10, < 1
2. POINT METHOD :
When we measure elasticity of demand at a point on linear
demand curve which intersects both axes , it is linear demand
curve which measuring elasticity of demand . The demand curve
has a negative slopes but price elasticity varies from point to point.
3. ARC ELASTICITY :
Arc elasticity is the elasticity of one variable with respect to another
between two given points . It is used when there is no general function
to define the relationship of the two variables . Arc elasticity is also
defined as the elasticity between two points on a curve.
4. PERCENTAGE METHOD :
Percentage method is one of the commonly used approaches of measuring price elasticity of
demand under which price elasticity is measured in terms of rate of percentage of change in
quantity demanded to percentage change in price .
According to this method , price elasticity of demand can be mathematically expressed as
EXAMPLE ,OF PERCENTAGE METHOD :
For an examples : when the price of a commodity was Rs 10 per unit , its demand in the
market was 50 units per day . When the price of the commodity fell to Rs 8, the demand rose to
60 units . Here price elasticity of demand cab be calculated as