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Suppose 5% increase in price causes 5% increase in expenditure on the good, what is the price elasticity of demand?

Asked by Topperlearning User 25th April 2016, 9:33 AM
Answered by Expert
Answer:

When expenditure on a good is increasing, proportionate to increase in price, the total quantity consumed of the good remains constant. Constant consumption means zero elasticity of demand.

Answered by Expert 25th April 2016, 11:33 AM
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