Question : The price elasticity of demand is calculated as the:

Option 1: Percentage change in quantity demanded divided by the percentage change in price.

Option 2: Percentage change in price divided by the percentage change in quantity demanded.

Option 3: Total change in quantity demanded divided by the total change in price.

Option 4: Total change in price divided by the total change in quantity demanded.

Question : The percentage change in _______ divided by the percentage change in _______ is the income elasticity of demand.

Option 1: The quantity demanded; income

Option 2: Income; the price

Option 3: Income; the quantity demanded.

Option 4: The price; income

Question : Statement 1: When the price of a product increases by 10%, and its quantity demanded decreases by 5%, the price elasticity of demand is - 0.5.

Statement 2: The price elasticity of demand is calculated as the percentage change in quantity demanded divided by the percentage change in price.

Option 1: Both statements are true.

Option 2: Both statements are false.

Option 3: Statement 1 is true, and statement 2 is false.

Option 4: Statement 1 is false, and statement 2 is true.

Question : Statement 1: The concept of price elasticity of demand measures the responsiveness of quantity demanded to changes in income.

Statement 2: Price elasticity of demand can be calculated by dividing the percentage change in quantity demanded by the percentage change in price.

Option 1: Statement 1 is true, and statement 2 is false.

Option 2: Statement 1 is false, and statement 2 is true.

Option 3: Both statement 1 and statement 2 are true.

Option 4: Both statement 1 and statement 2 are false.

Question : The responsiveness of demand to income is defined as:

Option 1: Quantity is demanded in response to a change in income.

Option 2: Demanded quantity in response to a price change.

Option 3: Price in response to a change in income.

Option 4: Income as a result of a change in quantity demanded