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Explain the concept of Elasticity of Demand? |
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Answer» The concept of Price Elasticity was developed by great neo-classical economist Dr. Alfred Marshall in the year 1890. According to Dr. Alfred Marshall, “The elasticity or responsiveness of demand in a market is great or small, according to the amount demanded which increases much or little for a given fall in price, and diminishes much or little for a given rise in price. ” Elasticity of demand in fact refers to the degree of responsiveness of the quantity demanded of a commodity to change in the variable on which demand depends. |
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