Q7 of 30 Page 1

Price elasticity of demand of Good X is -2 and Good Y is -3. Which of the two goods is more price elastic and why?

Price elasticity of demand of Good X is -2 and Good Y is -3. The demand for Good Y is more elastic that Good X because the elasticity demand is negative according to inverse relation between price and quantity demanded. Mathematically, -3 is lesser than -2, but it is stated by the elasticity of demands that -2 is lesser than -3.


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