Elasticity of Demand Class 12 MCQ

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

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