passwella.
Menu

JAMB Economics 1987 Question 18

Question 18

Elasticity

Given an original price of ₦3.50 per kilogram of rice and a change in price of ₦1.40, and given the quantity purchased at the old price as 10kg and a change in quantity as 5kg after the price change, the elasticity is equal to

  1. A.10.20
  2. B.3.57
  3. C.1.25
  4. D.0.80 .
Show the answer and explanation

Answer: C (1.25)

Explanation

% change in quantity = 5/10 = 50%. % change in price = 1.40/3.50 = 40%. Elasticity = 50 ÷ 40 = 1.25.