If the price of a commodity raised by 12% and Ed is (-) 0.63, the expenditure made on the commodity by a consumer will (a) Decrease (b) Increase (c) Remain same (d) Can’t Say Pls explain why

Question

Ayush · Answer

Increase as it is inelastic and in total expenditure method there is direct relationship of price and expenditure, so as prices have increased then TE will also increase

Nithya · Answer

Increase (b) It leads to higher expenditure for the consumer as the price in demand is increased than the original price (increase). Hope it helps. I think it's the reason.

Ayush · Answer

Increases

If the price of a commodity raised by 12% and Ed is (-) 0.63, the expenditure made on the commodity by a consumer will (a) Decrease (b) Increase (c) Remain same (d) Can’t Say Pls explain why

3 answers

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