Define the following terms : (a) Price elasticity of Demand (b) Prop

1.	Define the following terms : (a) Price elasticity of Demand (b) Proportional taxation(c) Capital formation(d) Labour(e) Inflation
Answer» (a) It is the degree of responsiveness of demand for a commodity with reference to change in price of the commodity. (b) If the tax is imposed at the same rate on the persons of different income level, it is called proportional tax. (c) It refers to the increase in the stock of real capital in an economy during an accounting period. (d) The aggregate of all human physical and mental effort used in creation of goods & services. (e) Inflation : Rapidly or persistent rise in price.

Define the following terms : (a) Price elasticity of Demand (b) Proportional taxation(c) Capital formation(d) Labour(e) Inflation

Answer»

(a) It is the degree of responsiveness of demand for a commodity with reference to change in price of the commodity.

(b) If the tax is imposed at the same rate on the persons of different income level, it is called proportional tax.

(d) The aggregate of all human physical and mental effort used in creation of goods & services.

(e) Inflation : Rapidly or persistent rise in price.