Business I / Demand and Elasticity
Practice question · Match the pairs

Match each elasticity type to its formula.

  • Price elasticity
  • Cross-price elasticity
  • Income elasticity
  • Unit elastic
  • (%ΔQ)/(%ΔM)(\%\Delta Q)/(\%\Delta M)
  • (%ΔQx)/(%ΔPy)(\%\Delta Q_x)/(\%\Delta P_y)
  • ∣ε∣=1|\varepsilon| = 1: revenue maximised
  • (%ΔQ)/(%ΔP)(\%\Delta Q)/(\%\Delta P)
Hints
  1. Each elasticity divides a proportional change by another.
  2. The denominators differ: own price, another price, or income.
Show the answer
  • Price elasticity → (%ΔQ)/(%ΔP)(\%\Delta Q)/(\%\Delta P)
  • Cross-price elasticity → (%ΔQx)/(%ΔPy)(\%\Delta Q_x)/(\%\Delta P_y)
  • Income elasticity → (%ΔQ)/(%ΔM)(\%\Delta Q)/(\%\Delta M)
  • Unit elastic → ∣ε∣=1|\varepsilon| = 1: revenue maximised
Why

Three elasticity types — price, cross-price, and income — plus the revenue-maximising threshold.

Read the lesson: Demand and Elasticity →

Practise Demand and Elasticity

The app has 6 more questions on this lesson, and keeps your place in the course. Business I is free to start.

Start Business I free Get it onGoogle Play

More questions on Demand and Elasticity