Identify and explain the concept : Demand for sugar falls by 10% when the price of sugar rises by 10%.
Q.2 (A) (ii) Identify and explain the concept : Demand for sugar falls by 10% when the price of sugar rises by 10%.
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Answer: Unitary elastic demand
Concept: Unitary elastic demand (Ed = 1). Explanation: When the percentage change in quantity demanded is exactly equal to the percentage change in price, demand is unitary elastic. Here \(E_d = \frac{\%\ \text{change in Qd}}{\%\ \text{change in P}} = \frac{10}{10} = 1\). The demand curve in this case is a rectangular hyperbola.
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· 28 Oct 2026
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