The price of a good falls from Rs 100 to Rs 60 per unit. If the price elasticity of demand is 1.5 and the original quantity demanded is 30 units, the new quantity demanded is:

1. Use $E_p = \dfrac{\Delta q}{\Delta p}\times\dfrac{p}{q}$ with $\Delta p = 100-60 = 40$, $p=100$, $q=30$. 2. Substitute: $1.5 = \dfrac{\Delta q}{40}\times\dfrac{100}{30}$. 3. Solve: $\Delta q = \dfrac{1.5\times40\times30}{100} = 18$ units. 4. New quantity = original + change = $30 + 18 = 48$ units. (18 is only the change, not the new quantity.) _Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 2 Unit I "Law of Demand and Elasticity of Demand", p.19_