Match List-I with List-II
List-I List-II (A) Price elasticity of demand will be equal to1 (I) When expenditure increases with a rise in price. (B) Price elasticity of demand will be equal to 0 (II) When expenditure decreases with a rise in price. (C) Price elasticity of demand will be more than 1 (III) When the quantity demanded doesn't change with the change in price. (D) Price elasticity of demand will be less than1 (IV) When expenditure doesn't change with the change in price.
Choose the correct answer from the options given below:
- (A) - (I), (B) - (II), (C) - (III), (D) - (IV)
- (A) - (III), (B) - (IV), (C) - (II), (D) - (I)
- (A) - (IV), (B) - (III), (C) - (II), (D) - (I)
- (A) - (IV), (B) - (III), (C) - (I), (D) - (II)
Match List-I with List-II
| List-I | List-II |
|---|---|
| (A) Price elasticity of demand will be equal to1 | (I) When expenditure increases with a rise in price. |
| (B) Price elasticity of demand will be equal to 0 | (II) When expenditure decreases with a rise in price. |
| (C) Price elasticity of demand will be more than 1 | (III) When the quantity demanded doesn't change with the change in price. |
| (D) Price elasticity of demand will be less than1 | (IV) When expenditure doesn't change with the change in price. |
Choose the correct answer from the options given below:
- (A) - (I), (B) - (II), (C) - (III), (D) - (IV)
- (A) - (III), (B) - (IV), (C) - (II), (D) - (I)
- (A) - (IV), (B) - (III), (C) - (II), (D) - (I)
- (A) - (IV), (B) - (III), (C) - (I), (D) - (II)
Solution
(A) Price elasticity = 1 (unit elastic) → Expenditure remains constant when price changes → Matches (IV).
(B) Price elasticity = 0 (perfectly inelastic) → Quantity doesn't respond to price changes → Matches (III).
(C) Price elasticity > 1 (elastic) → Quantity falls more than price rises, so expenditure decreases → Matches (II).
(D) Price elasticity < 1 (inelastic) → Quantity falls less than price rises, so expenditure increases → Matches (I).
Hence, Option 3: (A) - (IV), (B) - (III), (C) - (II), (D) - (I) → When demand is unit elastic (PED=1), total expenditure (Price × Quantity) remains unchanged regardless of price changes. With perfectly inelastic demand (PED=0), consumers buy the same quantity at any price. When demand is elastic (PED>1), percentage change in quantity exceeds percentage change in price, causing expenditure to move opposite to price. When demand is inelastic (PED<1), percentage change in quantity is less than percentage change in price, causing expenditure to move in the same direction as price. → correct
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