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How many types of elasticity of demand are recognised in ICMAI's Foundation Economics?
ATwo — Price and Income only
BFour — adding 'Advertising' elasticity
CFive — adding 'Substitution' and 'Time' elasticities
DThree — Price, Income, Cross
Answer & Solution
Correct answer: D. Three — Price, Income, Cross
1. ICMAI lists exactly three types of elasticity of demand.
2. These are Price elasticity (Ep), Income elasticity (Ey), and Cross elasticity (Ec).
3. All other concepts (e.g. advertising elasticity) are not in the Foundation list.
_Source: ICMAI BoS CMA Foundation Paper 4 (Business Economics & Management), Module 1 §1.3 (Theory of Demand) + §Elasticity of Demand, p. 33-46_
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