Demand Elasticity

Step 1: Understand the Diagram.
The given diagram represents a non-linear demand curve where the price is plotted on the y-axis and the quantity demanded on the x-axis. There is a point labeled "E" where the demand curve intersects a horizontal price line. Points "d" and "d₁" represent different demand points for the commodity.

Step 2: Answer the Questions. (1) If EB = EA (Ed = 1) = ........ Answer: When EB = EA, it implies that the price elasticity of demand (Ed) is 1. Therefore, at point E, the demand is **unitary elastic**. So, the answer is: (2) If EB > EA (Ed > 1) = ........ Answer: When EB > EA, it implies that the price elasticity of demand (Ed) is greater than 1. This indicates **elastic demand** where the quantity demanded is highly responsive to price changes. So, the answer is: (3) If EB < EA (Ed < 1) = ......... Answer: When EB < EA, it implies that the price elasticity of demand (Ed) is less than 1. This indicates **inelastic demand** where the quantity demanded is less responsive to price changes. So, the answer is: (4) The 'x' axis represents ......... of commodity and 'y' axis represents ........ of commodity. Answer: The 'x' axis represents the **quantity demanded** of the commodity, and the 'y' axis represents the **price** of the commodity. So, the answer is: