General Knowledge · Microeconomics
Consider the following statements regarding the Price Elasticity of Demand (PED): Statement I: If the Price Elasticity of Demand for a service is elastic (> 1), increasing the fee will lead to an increase in total revenue. Statement II: For products with inelastic demand (< 1), a significant increase in price will result in only a small decrease in quantity demanded. Statement III: The availability of close substitutes makes demand more elastic. Which of the statements given above are correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1I, II and III
- 2Only I and III
- 3Only II and III✓
- 4Only I
Correct answer
Only II and III
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