If the co-efficient of elasticity of demand is 1.5, then the demand is

Assessment: WAEC SSCE - Economics - 2008 (Objective) Subject: Economics

Question 1 Report

If the co-efficient of elasticity of demand is 1.5, then the demand is

Answer Details
If the coefficient of elasticity of demand is 1.5, it means that for a 1% change in price, the quantity demanded will change by 1.5%. This level of responsiveness is considered elastic. In other words, a small change in price will result in a relatively larger change in quantity demanded. Therefore, the answer is "elastic".
Read lesson note on Theory Of Consumer Behaviour (WAEC)
Read lesson note on The Theory Of Demand (JAMB)
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