What is the elasticity of demand for commodity X, if at a price of N25 the quantity demanded is 80 and when the price is reduced to N20 the quantity demande...

The elasticity of demand measures how much the quantity demanded of a commodity changes in response to a change in its price. If a small change in price causes a large change in the quantity demanded, demand is said to be elastic. If a large change in price causes only a small change in the quantity demanded, demand is said to be inelastic. To calculate the elasticity of demand for commodity X, we use the formula: Elasticity of demand = percentage change in quantity demanded / percentage change in price In this case, the price changes from N25 to N20, which is a 20% decrease in price. The quantity demanded changes from 80 to 100, which is a 25% increase in quantity demanded. Therefore, the elasticity of demand for commodity X is: Elasticity of demand = 25% / 20% = 1.25 Since the elasticity of demand is greater than 1, we can conclude that the demand for commodity X is elastic. This means that consumers are sensitive to changes in the price of commodity X, and a small change in price causes a relatively large change in the quantity demanded.