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Examveda

If demand is unitary elastic, a 25% increase in price will result in

A. 25% change in total revenue

B. No change in quantity demanded

C. 1% decrease in quantity demanded

D. 25% decrease in quantity demanded

Answer: Option D

Solution(By Examveda Team)

If demand is unitary elastic, a 25% increase in price will result in 25% decrease in quantity demanded.

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Related Questions on Economics

Which among the following statement is INCORRECT?

A. On a linear demand curve, all the five forms of elasticity can be depicted

B. If two demand curves are linear and intersecting each other, then, coefficient of elasticity would be same on different demand curves at the point of intersection.

C. If two demand curves are linear and parallel to each other, then, at a particular price, the coefficient of elasticity would be different on different demand curves.

D. The price elasticity of demand is expressed in terms of relaive not absolute changes in Price and Quantity demanded.