Suppose the price elasticity of demand for a good is -0.2 if there is a 5% increase in the price of the good, by what percentage will the demand for the good go dowm ?

Suppose the price elasticity of demand for a good is -0.2 if there is

1.	Suppose the price elasticity of demand for a good is -0.2 if there is a 5% increase in the price of the good, by what percentage will the demand for the good go dowm ?
Answer» <html><body><p></p>Solution :Given % Change (Rise)in price =5% Elasticity of Demand `(E_(d))= (-)0.2` <br/> Elasticirty of Demand `(E_(d))= ("<a href="https://interviewquestions.tuteehub.com/tag/percentage-13406" style="font-weight:bold;" target="_blank" title="Click to know more about PERCENTAGE">PERCENTAGE</a> Change in <a href="https://interviewquestions.tuteehub.com/tag/quantity-1174212" style="font-weight:bold;" target="_blank" title="Click to know more about QUANTITY">QUANTITY</a> <a href="https://interviewquestions.tuteehub.com/tag/demanded-7675308" style="font-weight:bold;" target="_blank" title="Click to know more about DEMANDED">DEMANDED</a>")/("Percentage Change in price ")` <br/> `(-) 0.2 = ("Percentage Change in QunatityDemanded")/5` <br/> Percentage fall in demand =<a href="https://interviewquestions.tuteehub.com/tag/1-256655" style="font-weight:bold;" target="_blank" title="Click to know more about 1">1</a>%</body></html>