Elasticity of Demand Class 12 MCQ for ISC Students with Answers are covered in this Article. This Article on Elasticity of Demand Class 12 MCQ Test contains 46 questions. MCQ on Economics Class 12 ISC have been made for Class 12 students to help check the concept you have learnt from detailed classroom sessions and application of your knowledge.
Elasticity of Demand Class 12 MCQ with Answers (Multiple choice questions)
Meaning and types of elasticity of demand
1.Elasticity of demand refers to the _________ of quantity demanded of a commodity to a change in any of its determinants
(a) degree of change
(b) degree of price
(c) degree of responsiveness
(d) degree of percentage
Answer
Answer: (c) degree of responsiveness
2. Which one of the following is not a main type of elasticity of demand
(a) Consumer Elasticity of Demand
(b) Price Elasticity of Demand
(c) Cross Elasticity of Demand
(d) Income Elasticity of Demand
Answer
Answer: (a) Consumer Elasticity of Demand
3.The demand for a good like salt is
(a) elastic
(b) inelastic
(c) unitary elastic
(d) perfectly elastic
Answer
Answer: (b) inelastic
Price elasticity of Demand and its types
4.___________ refers to the degree of responsiveness of the quantity demanded of a commodity in response to a change in its price
(a) Supply
(b) Elasticity of demand
(c) Price elasticity of demand
(d) None of the above
Answer
Answer: (c) Price elasticity of demand
5.Price elasticity of demand is denoted by
(a)es
(b)ep
(c)ed
(d)ef
Answer
Answer: (b)ep
6. When the percentage change in quantity demanded is greater than the percentage change in price of the commodity, the demand for the commodity is said to be
(a) perfectly elastic
(b) unitary elastic
(c) inelastic
(d) elastic
Answer
Answer: (d) elastic
7. Generally, the demand for _______ is inelastic
(a) luxuries
(b) normal goods
(c) necessities
(d) all of the above
Answer
Answer: (c) necessities
8. When quantity demanded of a commodity does not respond to a change in its price, the demand is called
(a) Inelastic Demand
(b) Perfectly Inelastic Demand
(c) Perfectly elastic demand
(d) Unitary elastic demand
Answer
Answer: (b) Perfectly Inelastic Demand
9.An almost true case of perfectly inelastic demand can be
(a) Mona Lisa Painting
(b) Inexpensive necessities
(c) Foreign Currency Exchange
(d) Life Saving Medicines
Answer
Answer: (d) Life Saving Medicines
10. In the case of Perfectly Elastic Demand Ep = ___
(a) 0
(b) 1
(c) Infinity
(d) None of the Above
Answer
Answer: (c) Infinity
11.Demand is ______ when the percentage change in quantity Demanded of a commodity is less than its percentage change in price
(a) Inelastic
(b) Elastic
(c) Unitary
(d) Perfect
Answer
Answer: (a) Inelastic
Elasticity of Demand Class 12 MCQ with Answers (Multiple choice questions)
Methods of Measurement of Price elasticity of Demand, with examples
12.Which of the following are methods of measurement of price elasticity of demand
(a) Percentage method
(b) Total Expenditure method
(c) Point method
(d) All of the above
Answer
Answer: (d) All of the above
13. What is the formula to measure price elasticity of demand by percentage method
(a)ΔQ/ΔP
(b) ΔQ x P / ΔP x Q
(c) P/Q
(d) ΔQ x Q / ΔP x P
Answer
Answer: (b) ΔQ x P / ΔP x Q
14. Total expenditure method of elasticity was suggested by
(a) Pareto
(b) Marshall
(c) Adam Smith
(d) Samuelson
Answer
Answer: (b) Marshall
15. When a ______ in price of commodity results in ______ in total expenditure, elasticity of demand will be greater than 1
(a) fall, fall
(b) rise, rise
(c) fall, rise
(d) rise, fall
Answer
Answer: (c) fall, rise
16. In the given figure with given values, identify the demand curve, given the initial price is 500 and quantity is 23, using total expenditure method
(a) Unitary Elastic
(b) Inelastic Demand
(c) elastic demand
(d) None of the above
Answer
Answer: (b) Inelastic Demand
17. When the total expenditure does not change with a change in price of the commodity, elasticity of demand is
(a) Inelastic
(b) Perfectly Inelastic
(c) Unitary
(d) Both a and b
Answer
Answer: (c) Unitary
18. Line Segment below the point on the demand curve / Line Segment above the point on the demand curve. What method of measuring price elasticity of demand does this formula refer to.
(a) Arc Method
(b) Percentage method
(c) Point Method
(d) None of the above
Answer
Answer:(c) Point Method
Elasticity of Demand Class 12 MCQ with Answers (Multiple choice questions)
Numericals on Elasticity of Demand
19.The Price Of a commodity rises from 5 to 6 and as a result its demand falls from 100 to 80 units. Find the price elasticity of demand using percentage method
(a) 0.5
(b) undefined
(c) 2
(d) 1
Answer
Answer: (d) 1
20. A household increase demand for a product from 40 to 50 units when it’s price falls by 10 percent, what is the price elasticity of demand
(a) 0.4
(b) 2
(c) 2.5
(d) 1.25
Answer
Answer: (c) 2.5
21.The price elasticity of demand is 0.5. If the percentage change in quantity demanded is 5, what is the percentage change in price
(a) 10
(b) 5
(c) 2.5
(d) 0.5
Answer
Answer: (a) 10
22. Price of a good falls from 10 to 8. As a result, demand rises from 80 to 90 units, what is the type of demand According to Total Expenditure method
(a) Inelastic
(b) Elastic
(c) Perfectly Elasticity
(d) Unitary Elastic
Answer
Answer: (a) Inelastic
23.The price elasticity of demand for a commodity is (-) 1.5. When its price falls by rupees 1, its quantity demanded rises from 30 units to 33 units. What was its previous price?
(a) 15.25
(b) 15.50
(c) 15.75
(d) None of the above
Answer
Answer: (d) None of the above
24. A consumer buys 200 units of a good at a price of 5 per unit. When the price changes, he buys only 100 units. If price elasticity of demand is 2, the changed price will be:
(a) Rs 5.75
(b) Rs 6.25
(c) Rs 6.75
(d) Rs 7.25
Answer
Answer: (b) Rs. 6.25
25. A consumer buys 80 units of a good at a price of rupees 8 per unit. Price falls to ` 6 per unit. How much quantity will the consumer buy at a new price if ep = (-) 2?
(a) 100 units
(b) 110 units
(c) 120 units
(d) 130 units.
Answer
Answer: (c) 120 units
Elasticity of Demand Class 12 MCQ with Answers (Multiple choice questions)
Factors affecting Price Elasticity of Demand
26.Which of the following is NOT a factor affecting price elasticity of demand
(a) Availability of Substitutes
(b) Proportion of Income Spent
(c) Techniques of Production
(d) Number of uses of a commodity
Answer
Answer: (c) Techniques of Production
27.Cadbury Chocolate has many close Substitutes, how will this affect its demand
(a) Demand will be Inelastic
(b) Demand will be Elastic
(c) demand will be unbothered
(d) none of the above
Answer
Answer: (b) Demand will be Elastic
28. If the number of uses of a commodity is high, say electricity, then the demand for it will be
(a) Elastic
(b) inelastic
(c) Unitary elastic
(d) perfectly inelastic
Answer
Answer: (a) Elastic
29. The demand for electricity is highly elastic since
(a) The number of uses of a commodity is high
(b) At a high price, it can only be used for important activities. Therefore, when the price drops it can be put to other uses as well
(c) Both a and b
(d) None of the above
Answer
Answer: (c) Both a and b
30. Price elasticity is generally _____ in the sort run
(a) high
(b) low
(c) unchanged
(d) none of the above
Answer
Answer: (b) low
31. Demand for a commodity is _______ if its consumption can be postponed
(a) perfectly inelastic
(b) inelastic
(c) elastic
(d) none of the above
Answer
Answer: (c) elastic
32. At very high and very low prices, demand for a commodity is said to be ____
(a) perfectly elastic
(b) elastic
(c) unitary elastic
(d) None of the above
Answer
Answer: (d) None of the above
33. If a consumer is habitual of consuming a certain good, the demand for it will be
(a) inelastic
(b) elastic
(c) perfectly inelastic
(d) unitary elastic
Answer
Answer: (a) inelastic
Elasticity of Demand Class 12 MCQ with Answers (Multiple choice questions)
Income and Cross Elasticity of Demand
34. ________ elasticity of demand measures the degree of responsiveness of the quantity demanded of a commodity to a change in the income of the consumer
(a) price
(b) money
(c) income
(d) cross
Answer
Answer: (c) income
35.Income Elasticity of Demand is said to be _______ when with an increase in income of the consumer, the amount purchased of a commodity increases and vice-versa with a decrease in income
(a) increasing
(b) negative
(c) positive
(d) elastic
Answer
Answer: (c) positive
36. If the percentage change in quantity demanded is smaller than the percentage change in in income, income Elasticity of demand will be
(a) less than 0
(b) more than unity
(c) less than unity
(d) undefined
Answer
Answer: (c) less than unity
37. In case of inferior goods, income elasticity of demand is
(a) inelastic
(b) 0
(c) negative
(d) between 0 and 1
Answer
Answer: (c) negative
38. Income elasticity of salt, after a given point may be ______ because an increase in income beyond a certain level may not bring about any change in its demand
(a) 1
(b) 0
(c) negative
(d) none of the above
Answer
Answer: (b) 0
39. ______ Elasticity of demand refers to the percentage change in quantity Demanded of a commodity with respect to a change in price of related goods
(a) Income
(b) Substitution
(c) Compliment
(d) cross
Answer
Answer: (d) cross
40. ______ goods have negative cross elasticity of demand
(a) Substitute
(b) Complimentary
(c) Unrelated
(d) Expensive
Answer
Answer: (b) Complimentary
41. Cross elasticity of demand is 0 when two goods are ________
(a) substitutes
(b) complements
(c) unrelated
(d) the same
Answer
Answer: (c) unrelated
42. When quantity demanded of a commodity does not respond to a change in its price, then elasticity of demand is
(a) One
(b) Infinity
(c) Zero
(d) Two
Answer
Answer: (c) Zero
43. When consumers are prepared to purchase all that they can get at a particular price but not at a higher price , then the price elasticity is
(a) Infinite
(b) Zero
(c)One
(d)Two
Answer
Answer: (a) Infinite
44. When the percentage change in the quantity demanded of a commodity exceeds the percentage change in its price, the elasticity of demand is
(a) Perfectly elastic
(b) Greater than unitary
(c) Both (a) and (b)
(d) None of the above
Answer
Answer: (b) Greater than unitary
45. When price elasticity of demand is measured over a finite range, it is called
(a) Point elasticity
(b) Arc elasticity
(c) Period elasticity
(d) None of the above
Answer
Answer:(b) Arc elasticity
46. Which of the following are the methods of measurement of price elasticity of demand
(a) Percentage method
(b) Total expenditure method
(c) Point method
(d) All of the above
Answer
Answer: (d) All of the above
Economics Class 12 ISC MCQs – Term 1
- Demand and Law of Demand MCQ Class 12
- Theory of Consumer Behaviour Class 12 MCQ
- Elasticity of Demand
- Supply – Law of Supply and Price Elasticity of Supply
- Market Mechanism
- Law of Returns
- Cost and Revenue Analysis
- Forms of Market
- Producer’s Equilibrium
- Determination of Equilibrium Price and Output under Perfect Competition