Business High School
Answers
Answer 1
Answer:
d.percentage change in the quantity demanded of one good divided by the percentage change in the price of another good.
Explanation:
Price-demand elasticity measures the demand sensitivity of a good when a change in the price of another good occurs. For example, what happens to the demand for bread when the price of butter varies? This depends on the cross elasticity of demand since these goods tend to be complementary.
The price elasticity of cross demand between two goods is easily calculated by a formula where the numerator is the change in the quantity of a good and the denominator is the percentage change in the price of the complementary good.
If the calculation of elasticity is greater than 1, it means that the amount demanded for bread is sensitive (elastic) to the price of butter and tends to vary sharply. If the result is between 0 and 1, the demand is inelastic, that is, the amount of bread demanded will not change considerably when the price of butter varies. If the calculation is equal to 1, then the demand for bread varies perfectly with the price of butter.
Related Questions
Damon Co. purchased 100% of the outstanding common stock of Smith Co. in an acquisition by issuing 20,000 shares of its $1 par common stock that had a fair value of $10 per share and providing contingent consideration that had a fair value of $10,000 on the acquisition date. Damon also incurred $15,000 in direct acquisition costs. On the acquisition date, Smith had assets with a book value of $200,000, a fair value of $350,000, and related liabilities with a book and fair value of $70,000. What amount of gain should Damon report related to this transaction?
Answers
Answer: the correct answer is $70000
Explanation: the fair value of the shares given plus the fair value of the contingent consideration is the total amount paid by the buyer which is (20000 shares * $10 price per share) = $200000+$10000= $210000.
The gain of the transaction is registered as the net fair value of the acquiree that is $350000-$70000= $280000 less the sum paid by the Acquirer that is $280000-$210000= $70000.
The $15000 in direct acquisition costs are registered as period expenses and not relevant for the calculation of the gain of the transaction.
Bookworm Publishers publishes books and they have gathered the following data for the month of October: Data Cash on 8/1 $7,000 Expected Cash Collections $350,000 Direct Materials Cash Disbursements $62,000 Direct Labor Cash Disbursements $45,000 MOH Cash Disbursements $43,000 Operating Expenses Cash Disbursements $85,000 Capital Expenditures Cash Disbursements $125,000 Bookworm Publishers requires an ending cash balance of at least $5,000 and can borrow from a line of credit in $1,000 increments. What is the excess or deficiency of cash for October?
Answers
Answer:
Deficiency of cash for the month of October = $7,000
Explanation:
Opening cash = $7,000
Add: Expected cash collections = $350,000
Total cash in hand expected = $357,000
Less: Cash disbursements
Direct Material = $62,000
Direct Labor = $45,000
MOH Disbursements = $43,000
Operating Expense = $85,000
Capital Expense = $125,000
Total cash disbursements = $360,000
Net balance expected = $357,000 - $360,000 = $3,000 deficit.
Also provided month end balance should be $5,000
Therefore total deficit = $3,000 + $5,000 = $8,000
Now provided $1,000 cash can be borrowed in that case net deficit = $8,000 - $1,000 = $7,000
The cash deficiency for October is $3,000 for Bookworm Publishers.
Further Explanation:
Excess Cash:
When the cash inflow is higher than the cash outflow, then the condition is considered as excess cash. In this case, business is generating a higher amount of cash than it is spending. It is a favorable condition for the business.
Cash Deficiency:
When the cash outflow is higher than the cash inflow, then the condition is known as cash deficiency. In this case, business in generating less amount of cash than it is spending. It is an unfavorable condition for the business.
Calculate the excess or deficiency of cash for October:
The total cash outflow of Bookworm Publisher is $360,000 as per working note 1, and the total cash inflow is $357,000. The outflow is higher than the inflow, so there will be cash deficiency.
Cash Deficiency = Total cash outflows - Total cash inflows
= $360,000 - $357,000
= $3,000
Thus, the net cash deficiency is $3,000.
Working note 1:
Calculate the total cash outflow:
Total cash outflows = Direct materials + Direct labor + MOH cash disbursements + Operating expenses + Capital expenditure
= $62,000 + $45,000 + 43,000 + 85,000 + $125,000
= $360,000
Therefore, the total cash outflow is $360,000.
Working note 2:
Calculate the total cash inflow:
Total cash inflow = Opening cash balance + Expected cash collections
= $7,000 + $350,000
= $357,000
Therefore, the total cash inflow is $357,000.
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Answer details:
Grade: Middle School
Subject: Finance
Chapter: Cash Budgeting
Keywords: Bookworm publisher, publishes, books, month, October, Data Cash, Expected Cash Collections, Expected Cash Collections, Direct Labor Cash Disbursements, MOH Cash Disbursements, Operating Expenses Cash Disbursements, capital Expenditures Cash Disbursements, ending cash balance, borrow from a line of credit, excess or deficiency of cash.
The manager at Screaming Trees has been trying to calculate the portion of the company's overhead expenses that is fixed and the portion that is variable. Over the past twelve months, the number of yards of mulch processed was highest in July, when the total monthly overhead costs totaled $ 30 , 000 for 36 , 000 yards of mulch processed. The lowest number of yards of mulch processed in the last twelve months occurred in October, when total overhead costs were $ 23 , 000 for 27 , 000 yards of mulch processed. What was the variable cost per yard?
Answers
Answer:
The answer is: $0.78 per yard (rounded to 2 decimal places)
Explanation:
In costing products, the high-low method is used to determine the costs of production when there is limited information provided. In this method, the goal is to separate the fixed costs and the variable costs of production based on the highest level of activity and the lowest level of activity together with the associated costs at both levels. The total fixed costs of production remain fixed during production whereas the total variable costs change in proportion to production levels. This calculation is done as follows:
(Highest cost - Lowest cost)/(Highest activity level - Lowest activity level)
($30,000 - $ 23,000)/(36,000 yards - 27,000 yards)
$7000/9,000 yards
Variable cost = $0.777777777/yard
At 27, 000 yards , the fixed costs are $2,000 whereas the variable costs amount to $21, 000 (0.777777777*27,000). At 36, 000 yards, the fixed costs are $2,000 whereas the variable costs amount to $28, 000 (0.777777777*36,000). The fixed cost at each level of production remains constant, regardless of production level,at $2,000. The variable costs increase from $21,000 to $28,000.
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Mirr, Inc. was incorporated on January 1, 2010, with proceeds from the issuance of $750,000 in stock and borrowed funds of $110,000. During the first year of operations, revenues from sales and consulting amounted to $82,000, and operating costs and expenses totaled $64,000. On December 15, Mirr declared a $3,000 cash dividend, payable to stockholders on January 15, 2011. No additional activities affected owners' equity in 2010. Mirr's liabilities increased to $120,000 by December 31, 2010. On Mirr's December 31, 2010, balance sheet, total assets should be reported at ________.
Answers
Answer: the correct answer is $ 885,000
Explanation:
Mirr began operations on January 1, 2010
Assets= Liabilities + Patrimony or owner's equity
$860,000 = $110,000+ $750,000
In the first year liabilities grew to $120,000 and patrimony increased to $765,000 which is $750,000 beginning balance + $18,000 ($82,000 revenues - $64,000 expenses) - $ 3,000 declared dividends.
So for December 31, 2010 the assets should be
$885,000 = $120,000 + $ 765,000.
The owner of a rare manuscript and a collector entered into a written agreement for the sale of the manuscript at a price of $7,500, which was to be paid upon delivery of the manuscript on a specific day. When the owner tendered the manuscript on the specified date, the collector refused to accept it or to pay for it. The owner tried in good faith, by commercially reasonable means, to sell the manuscript, but he was unsuccessful. He subsequently brought suit against the collector for specific performance of the contract. For whom should the court rule?
Answers
Answer: The court should rule in favor of the collector, because in this case the restitution are an competent rectification for the individual.
In broad terms, particular performance is not available as a rectification for breach of a agreement when restitution are an adequate rectification for the non breaching organization.
The court should rule in favor of the collector.
Further Explanation:
Specific performance:
Specific performance refers to a court-enforced remedy for the breach of contract. When a party of the contract does not perform their part of the contract, then it is considered as a breach of contract. In specific performance, the suffering party goes to the court regarding the breach of contract, and the court mandates the defaulting party to perform the activities specified in the contract. In specific performance, the defaulting party has to perform their obligations specified in the original contract. But specific performance is not applicable or granted by the court in the following cases:
•The performance of the specific performance would result in an unreasonable and adverse effect on the default party or defendant.
•The contract was not justified.
•The damages are readilly available.
•The losses suffered by the suffering part can be easily substituted.
•Specific performance requires personal services.
•The contract is not clear.
•The contract was ceased at the common will.
•The activity in the contract requires supervision.
•The contract was not created with the provision of termination at will.
•The contract was created with no consideration.
•Specific performance is not applicable in case of void contract.
•Specific performance is not applicable in case of the injunction to restrain.
•The suffering party is also involved in the breach of contract
Court rule on the suit against the collector:
In the given case, owner of the manuscript (suffering party) has entered in the contract to sell the manuscript to a collector at a specific price on a specific date. The collector refused to pay for the manuscript on the specific date, and owner filled the suit for the special performance.
The owner of the manuscript tried to sell the product to any other collector in the market, but he was unsuccessful. Therefore, the loss cannot be substituted. The owner can claim damages from the collector in this case. The court rule would rather order the collector to pay for the damages rather than the specific performance of the contract.
Hence, the court should rule in favor of the collector.
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Answer details:
Grade: Senior School
Subject: Business Law
Chapter: Contract Act
Keywords: Owner, rare manuscript, collector, written agreement, sale of the manuscript, paid upon delivery, specific day, tendered, refused, tried in good faith, commercially reasonable means, unsuccessful, subsequently, suit against, specific performance, contract, court rule.
Denise values a stainless steel dishwasher for her new house at $500. The actual price of the dishwasher is $650. Denise A. buys the dishwasher, and on her purchase she experiences a consumer surplus of $-150. B. buys the dishwasher, and on her purchase she experiences a consumer surplus of $150. C. does not buy the dishwasher, and on her purchase she experiences a consumer surplus of $0. D. does not buy the dishwasher, and on her purchase she experiences a consumer surplus of $150.
Answers
Answer:
C. does not buy the dishwasher, and on her purchase she experiences a consumer surplus of $0.
Explanation:
A consumer surplus is the difference between what a consumer pays for an item and what they are willing to pay. In this case Denise is willing to pay $500 and pays $650. The amount she pays is more than she is willing to pay hence her consumer surplus can't be negative. This means it will be 0.
Which of the following statements is correct? a.If the monopolist's marginal revenue is greater than its marginal cost, the monopolist can increase profit by selling fewer units at a higher price per unit. b.If the monopolist's marginal revenue is greater than its marginal cost, the monopolist can increase profit by selling more units at a lower price per unit. c.If the monopolist is earning a positive economic profit, it must be producing where MR equals MC. d.When a monopolist produces where price equals the minimum of average total cost, it earns a positive economic profit.
Answers
Answer:If the monopolist's marginal revenue is greater than its marginal cost, the monopolist can increase profit by selling more units at a lower price per unit.
Explanation:
If the monopolist's marginal revenue is greater than its marginal cost, the monopolist can increase profit by selling more units at a lower price per unit. In the case of higher MR , the maximum profit will come about at the level of where MR is equal to the MC. So in this case to increase the profit, MR i,e, also the price can be lower to the level of MC to sell more commodity and earn higher profits.
Susanne, the CEO of a national IT manufacturer, was approached by Simple Phones, a new company that is marketing a new type of phone, to partner with the company on a project. The results of the partnership are uncertain because the company (Simple Phones) and its technology are new. Susanne is uncertain what to do because she is limited by numerous constraints, such as the uncertainty and complexity of the technology, the management success of Simple Phones, and time (because other companies are interested in the partnership). Susanne is experiencing ____________.
Answers
Answer: Susanne is experiencing bounded rationality
Explanation: While taking a decision individuals take various factors into consideration like amount of time and information they have, limitations of mind etc. Bounded rationality states that rationale of individual while taking decisions gets affected by such factors. Just in this case,Susanne is not confident about decision making because she does not have enough level of information.
If nominal GDP is $12 trillion and real GDP is $10 trillion, then the GDP deflator is a. 120, and this indicates that the price level has increased by 20 percent since the base year. b. 83.33, and this indicates that the price level has increased by 83.33 percent since the base year. c. 120, and this indicates that the price level has increased by 120 percent since the base year. d. 83.33, and this indicates that the price level has decreased by 16.67 percent since the base year.
Answers
Answer:
a. 120, and this indicates that the price level has increased by 20 percent since the base year.
Explanation:
Nominal GDP is the amount of goods and services produced by a country taking inflation and deflation into account. Real GDP is the amount of goods and services produced in a country based on prices of a base year. a base year is a chosen year that is used as a reference.
GDP deflator is calculated as follows:
Nominal GDP ÷ Real GDP × 100
( 12 trillion ÷ 10 trillion ) x 100
= 120
the change ∴ is an increase in 20% from the base year
Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot. a. The cost of the parking permit is not part of the opportunity cost of attending college if you would not have to pay for parking otherwise. b. Only half of the cost of the parking permit is part of the opportunity cost of attending college. c. The cost of the parking permit is not part of the opportunity cost of attending college under any circumstances. d. The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
Answers
Answer:
d. The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
Explanation:
Opportunity cost is a microeconomic concept used to describe how much an economic agent fails to earn in one economic activity by employing money in another economic activity. Thus, all expenses that a student performs to study at the university, including tuition, gasoline, parking, material, and time spent on the activity, is considered an opportunity cost, since all of this could be spent on another activity.
On December 12, year 1, Imp Co. entered into three forward exchange contracts, each to purchase 100,000 euros in ninety days. The relevant exchange rates are as follows: Spot rate Forward rate (for March 12, year 2) November 30, year 1 $.87 $.89 December 12, year 1 $.88 .90 December 31, year 1 $.92 .93 At December 31, year 1, what amount of foreign currency transaction loss should Imp include in income from the revaluation of the Accounts Payable of 100,000 euros incurred as a result of the purchase of inventory at November 30, year 1, payable in March year 2?
Answers
Answer:
40.000
Explanation:
I think your approach is not clear at all, but your question is.
So if you have bought merchandise worth 100,000 euros but your records are in other currencies, you must take the exchange rate at the time of the operation, this is $ 0.89. You will register
Inventorty 890.0000
accounts paylable 890,000
At the close of the fiscal year your liabilities must be valued at the official exchange rate, in this case it is $ 0.93
then your foreign currency debt increases, but not your inventory, the other account that is used is a negative result for this rate change
loss exchange rate 40,000
accounts paylable 40.000
in the valuation of liabilities the seller exchange rate is used
Which of the following statements is CORRECT? a. A time line is not meaningful unless all cash flows occur annually. b. Time lines are not useful for visualizing complex problems prior to doing actual calculations. c. Time lines can be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. d. Time lines can only be constructed for annuities where the payments occur at the end of the periods, i.e., for ordinary annuities. e. Time lines cannot be constructed where some of the payments constitute an annuity but others are unequal and thus are not part of the annuity.
Answers
Answer: Option C
Explanation: The correct statement is time lines can be constructed to deal with situations where some of the cash occur annually but others occur quarterly. A time line can be defined as the display of events in a chronological order. While solving problems related to cash flow, time line is prepared to ease the calculations by showing cash flow as the the order of their occurrence.
Wildhorse Delight, Inc. charges an initial franchise fee of $74,700 for the right to operate as a franchisee of Wildhorse Delight. Of this amount, $24,900 is collected immediately. The remainder is collected in four equal annual installments $12,450 each. These installments have a present value of $41,522. As part of the total franchise fee, Wildhorse Delight also provides training (with a fair value of $2,000) to help franchisees get the store ready to open. The franchise agreement is signed on April 1, 2017, training is completed, and the store opens on July 1, 2017. Prepare the journal entry required by Wildhorse Delight in 2017.
Answers
Answer:
Cash 24,900 debit
Account Receivable 51,800 debit
Franchise fee revenue 74,700 credit
training services revenue 2,000 credit
Explanation:
The training services and the francise fee are separated revenues, so we have to use diferent account.
we are only given with the information of a initial payment, so the difference will part of account payable.
No information about the training being paid in cash, so we also assume this services were performed on account.
Colaw Co. pays all salaried employees on a biweekly basis. Overtime pay, however, is paid in the next biweekly period. Colaw accrues salaries expense only at its December 31 year end. Data relating to salaries earned in December 2014 are as follows: Last payroll was paid on 12/26/14, for the 2-week period ended 12/26/14. Overtime pay earned in the 2-week period ended 12/26/14 was $20,000. Remaining work days in 2014 were December 29, 30, 31, on which days there was no overtime. The recurring biweekly salaries total $360,000. Assuming a five-day workweek, Colaw should record a liability at December 31, 2014 for accrued salaries of _______.
Answers
Assuming a five-day workweek, Colaw should record a liability of 128000 for accrued salaries on December 31, 2014.
What is liability?
- Liability, in general, refers to the state of being responsible for something, and it can refer to any money or service owed to another party.
- For example, tax liability can refer to property taxes owed to the municipal government or income taxes owed to the federal government.
- Your balance sheet can be divided into two categories in its most basic form: assets and liabilities. Your company's assets are the items it owns that can provide future economic benefit.
- Amounts owed to third parties are referred to as liabilities. To summarize, assets put money in your pocket while liabilities take money out!
Therefore,
20000 +(360000 / 10 + 3 days) = 128000
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Answer: the correct answer is $128,000
Explanation:
$20,000 (overtime pay) + ($ 360,000 / 10*3). Biweekly salaries are
$360,000 and the week has 5 days that's why we have to consider a biweekly salary for 10 days and multiple that by 3 days.
$20,000 + $108,000 = $128,000
In a closed economy, the values for GDP, consumption spending, investment spending, transfer payments, and taxes are as follows: Y = $12 trillion C = $9 trillion I = $3 trillion TR = $2 trillion T = $3 trillion Using the information above, what is the value of private saving and public saving? A. Private saving = $1 trillion and public saving = $2 trillion. B. Private saving = $3 trillion and public saving = $9 trillion. C. Private saving = $2 trillion and public saving = $1 trillion. D. Private saving = $9 trillion and public saving = $3 trillion.
Answers
Answer: Option (C) is correct.
Explanation:
National Savings is divided into two parts, private savings and public savings.
Private Savings = GDP - Taxes + Transfer payments - Consumption Spending
= Y - T + TR - C
= 12 - 3 + 2 - 9
= $ 2 trillion
Public Savings = Taxes - Government Spending - Transfer payments
= 3 - 0 - 2
= $1 trillion
∴ Option (C) is correct.
Private saving = $2 trillion and public saving = $1 trillion.
Which of the following is correct? a. Nominal GDP is the variable most commonly used to measure short-run economic fluctuations. These fluctuations can be predicted with some accuracy. b. Real GDP is the variable most commonly used to measure short-run economic fluctuations. It is almost impossible to predict these fluctuations with much accuracy. c. Real GDP is the variable most commonly used to measure short-run economic fluctuations. These fluctuations can be predicted with some accuracy. d. Nominal GDP is the variable most commonly used to measure short-run economic fluctuations. It is almost impossible to predict these fluctuations with much accuracy.
Answers
Answer:
C. Real GDP is the variable most commonly used to measure short-run economic fluctuations. These fluctuations can be predicted with some accuracy.
Explanation:
GDP is the sum of the values of all goods and services produced by an economy in a given period. The difference between nominal GDP and real GDP consists in the fact that nominal GDP is calculated at current prices, while real GDP is calculated at constant prices, ie it is calculated under a base year chosen to eliminate the effect of inflation. A more consistent assessment considers real GDP. The measurement technique consists of deflating GDP by a price index that allows measuring only changes in quantities and not in market prices. Usually, the techniques for measuring GDP have a good forecast.
Which NIMS Management Characteristic includes maintaining accurate and up-to-date inventories of personnel, equipment, teams, and supplies? A. Comprehensive Resource Management B. Incident Facilities and Locations C. Management by Objectives D. Dispatch/ Deployment
Answers
Answer: Option A
Explanation: The comprehensive resource management is the characteristic of NIMS management that includes maintaining accurate and up to date inventories of various assets. CRM standardizes the mechanism for various functions like order and acquire etc. in relation to inventories of personnel, equipment, teams and supplies.
Lark had net income for 2018 of $105,000. Lark has 33,000 shares of common stock outstanding at the beginning of the year and 48,000 shares of common stock outstanding at the end of the year. There were 5,000 shares of preferred stock outstanding all year. During 2018, Lark declared and paid preferred dividends of $30,000. On December 31, 2018, the market price of Lark's common stock is $32.00 per share and the market price of its preferred stock is $57.00 per share. What is Lark's price/earnings ratio at December 31, 2018? (Round any intermediate calculations and your final answer to the nearest cent.)
Answers
Answer:
Price Earnings Ratio = 20.48
Explanation:
Price Earnings Ratio = Price/Earnings per share
Here Price is of common stock
In the given case = $32
Earnings per share are calculated at year end for common stock.
Earnings for common stock = Net income - Dividend to preference shares = $105,000 - $30,000 = $75,000
Earnings per share = $75,000/48,000 shares = $1.5625
Price Earnings Ratio = = 20.48
Note: There is no relevance of share price of preference shares, also no relevance on opening number of shares of equity as PE Ratio is calculated on closing number of shares and on the date and not for the period that we will consider the average.
Price Earnings Ratio = 20.48
On January 1, 2018, Ritt Corporation acquired 80 percent of Shaw Corporation’s $10 par common stock for $956,000. On this date, the fair value of the noncontrolling interest was $239,000, and the carrying amount of Shaw’s net assets was $1,000,000. The fair values of Shaw’s identifiable assets and liabilities were the same as their carrying amounts except for plant assets (net) with a remaining life of 20 years, which were $100,000 in excess of the carrying amount. For the year ended December 31, 2018, Shaw had net income of $190,000 and paid cash dividends totaling $125,000. In the December 31, 2018, consolidated balance sheet, the amount of noncontrolling interest reported should be ______.
Answers
Answer:
$247,000
Explanation:
Since uncontrolled interest = 20%
Value of uncontrolled interest reported at year end = 20%
Carrying value already = $239,000
Add: Share in profits net of dividend as dividend will reduce the value, treated separately
= Share in profit = $190,000 - $125,000 = $65,000 X 20% = $13,000
Thus carrying value = $239,000 +$13,000 = $252,000
Note asset adjustment is also to be added of plant = $100,000 X 20% = $20,000
Thus net carrying value = $252,000 + $20,000 = $272,000
Less: Dividends as reduces the cost of investment as per equity method = $125,000 X 20% = $25,000
$272,000 - $25,000 = $247,000
The seller of a residential property was holding an open house. A potential buyer stopped by the open house, and instantly fell in love with the property. The buyer made the seller an oral offer on the house, and the seller instantly accepted it. The parties shook hands and planned to meet later in the week to sign a contract for the sale. The following day, the buyer accepted an offer for the sale of her own house, which she had been putting off until she found a new house to move into. Shortly thereafter, the seller received a higher offer on the house. The seller called the buyer, and said that the deal was off. The buyer sued the seller for breach of contract and sought specific performance. Is the buyer likely to succeed in his claim?A. No, because the Statute of Frauds requires a land sales contract to be in writing.B. No, because the seller repudiated before the time for performance had passed.C. Yes, because the buyer sold her own house.D. Yes, because the property was residential property.
Answers
Answer: The buyer is likely to succeed in his claim because the buyer sold her own house.
Land sales agreement generally are written,and therefore subscribed by the organization, and incorporate all the necessary terms, in order for this to be enforceable. However, if there is no written agreement involved, a organization may be worthy to specific performance if they have noxiously relied on oral contract.
FAQs
The Cross-price Elasticity Of Demand Measures The A.percentage Change In The Quantity Demanded Of One? ›
Also called cross-price elasticity of demand, this measurement is calculated by taking the percentage change in the quantity demanded of one good and dividing it by the percentage change in the price of the other good.
What does the cross price elasticity measure? ›Cross-price elasticity measures how sensitive the demand of a product is over a shift of a corresponding product price. Often, in the market, some goods can relate to one another. This may mean a product's price increase or decrease can positively or negatively affect the other product's demand.
Does cross-price elasticity of demand measure the response of the quantity demanded of one good to a change? ›The cross-price elasticity of demand measures the responsiveness of the quantity demanded of one good when compared with a change in the price of another good. Substitutes (E>0). Are goods that can be used in exchange for one another.
What is the cross-price elasticity of demand measured by quizlet? ›The cross-price elasticity is equal to the change in demand divided by the change in price.
What is price elasticity when percentage change in quantity demanded is more than percentage change in price? ›If the percentage change in quantity demanded is greater than the percentage change in price, demand is said to be price elastic, or very responsive to price changes.