Economics Multiple Choice Question – 15 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Economics

If the Price elasticity of demand is -0.5, then a 10% INCREASE in price will?

Select ONE answer:

  1. Increase in sales by 20%
  2. Decrease in sales by 20%
  3. Increase in sales by 5%
  4. Decrease in sales by 5%
  5. Leaves sales unchanged

How can price elasticity of demand be estimated:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Economics KS5 classes.

The answer is 4 – The formula for calculating the price elasticity of demand is: Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price. Therefore with PED = -0.5 then an increase in price will decrease sales -0.5 * 10% by 5%.

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Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

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