Price Elasticity of Demand (Edexcel A-Level Business): Quizzes
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Practise the questions
10 questions from this quiz
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Practise the questions
10 questions from this quiz
What does price elasticity of demand (PED) measure?
What does price elasticity of demand (PED) measure?
Responsiveness of demand to price changes
If price falls 20% & demand rises 10%, what is the PED value?
If price falls 20% & demand rises 10%, what is the PED value?
0.5
A product has a PED of 2.5. How is this demand classified?
A product has a PED of 2.5. How is this demand classified?
Price elastic
Which product typically has price inelastic demand?
Which product typically has price inelastic demand?
Petrol in the short term
How does time period affect price elasticity of demand?
How does time period affect price elasticity of demand?
Elasticity increases over longer periods
What effect do substitutes have on price elasticity?
What effect do substitutes have on price elasticity?
More substitutes make demand more elastic
How does strong branding affect price elasticity?
How does strong branding affect price elasticity?
Reduces elasticity by creating loyalty
If demand is inelastic & price increases, what happens to total revenue?
If demand is inelastic & price increases, what happens to total revenue?
Total revenue rises
If demand is elastic & price decreases, what happens to total revenue?
If demand is elastic & price decreases, what happens to total revenue?
Total revenue rises
What is wrong with saying inelastic demand means 'no change in demand' when prices change?
What is wrong with saying inelastic demand means 'no change in demand' when prices change?
Demand still changes, just less than price