Economics (AS & A Level) · Oct / Nov 2023 · Paper 13 · Question 10
9708Price elasticity, income elasticity and cross elasticity of demand
The price elasticity of demand for a product is –0.6. The supplier wants to clear all surplus stock of a product and reduces the price of a good by 50%. What is the effect of this price change on the quantity purchased and the expenditure on the good?
- Arises by 30% / falls
- Brises by 30% / rises
- Crises by 60% / falls
- Drises by 60% / rises
As printed in the paper
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Correct answer: A. rises by 30% / falls
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