CA Foundation Theory of Demand & Elasticity — practice questions

Explore 2 free Theory of Demand & Elasticity questions in CA Foundation Economics. Open each question or exercise to read its content, reference answers and available explanation.

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Theory of Demand & Elasticity questions and exercises with answers

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CA Foundation · Economics · Elasticity Examples — PairRead the answer and worked solution →The quantity demanded of a commodity is best described as which of the following?Read the answer and worked solution →

Worked practice questions

CA Foundation · Economics · Elasticity Examples — Pair

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Matching pairs

Left
Common salt
Right
Highly inelastic demand
Left
Luxury car
Right
Highly elastic demand
Left
Petrol
Right
Inelastic short-run, elastic long-run

Instructions

Match each good to its likely demand elasticity.

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The quantity demanded of a commodity is best described as which of the following?

A flow expressed per unit of time at a given price
A single isolated stock held by the seller
A fixed lifetime total independent of price
A value set only by the government regulator

Show answer and solution

Correct answer: A. A flow expressed per unit of time at a given price

1. Quantity demanded is always expressed at a given price. 2. It is a flow, not a single isolated purchase, so it is stated as 'so much per period of time'. 3. For example, one thousand dozens of oranges per day. 4. The option capturing both 'flow' and 'per unit of time at a given price' is correct. _Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 2 Unit I "Law of Demand and Elasticity of Demand", p.2_

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