Given the following demand schedule: Price (₹) Quantity (units) 60 10 50 12 What would be the price elasticity of demand when the price falls from ₹ 60 to ₹ 50?

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ep = 1 Explanation: When a given percentage change in the price of a commodity causes an equivalent percentage change in the quantity demanded, then the elasticity of demand is said to be unitary (or one). ep = `"Percentage change in quantity demanded"/"Percentage change in price"` Percentage change in quantity = (12-10)/10xx100 = 2/10xx100 = 20% Price changes from ₹ 60 to ₹ 50 Percentage change in price = (60-50)/60xx100 = 10/60xx100 = 16.67% Price elasticity of demand = (20%)/(16.67%) = 1.2 The price elasticity of demand is approximately 1.2.

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