How is the price elasticity of demand measured?The price elasticity of demand is measured asA. the percentage change in the quantity supplied divided by the percentage change in the quantity demanded.B. the change in the quantity demanded divided by the change in price.c. the slope of the demand curve.D. the percentage change in the quantity demanded divided by the percentage change in price.O E. the quantity demanded divided by price.O O O O

a). ed measures the relation or responsiveness of the Qd with the change in P(price): with the rise in P, Qd falls and vice a versa, therefore we take Qd(quantity demanded) into consideration and not Qs(quantity supplied) which has a positive relation with P. hence, option A is incorrect. b). formula used is: ed=∆Qd∆P×PQ Which multiplies the ratio of change in Qd and change in P with the ratio of old/original P and Q. Hence, option B is incomplete and incorrect. c). the slope (m) of dd(demand) curve is: m=∆P∆Qd Hence option C is incomplete and incorrect. d). the price elasticity(ed) of demand measures the ratio of % change in Qd(quantity demanded) and the % change in P(price) of the good. ed=% change in Qd% change in P Hence, option D is correct. e). option E is incorrect as it is not the correct formula for ed.