waecE-LEARNING
Economics Paper 2, May/June 2012  
Questions: 1 2 3 4 5 6 7 8 9 10 11 12 Main
General Comments
Weakness/Remedies
Strength




QUESTION 7





        

(a)        Define
(i)         elasticity of demand;
(ii)        price elasticity of demand.
(b)        State any four determinants of price elasticity of demand.
(c)        Draw curves illustrating
                        (i)         fairly elastic demand;
                        (ii)        perfectly inelastic demand.

 

 

 

.

 

This question was attempted by many of the candidates who performed fairly above average.  Candidates generally provided expected answers for the (a) and (c) parts of the question but only a few of them attempted the (b) part of the question appropriately.

The candidates who scored low marks in this question failed to provide the following answers:

(b)        The determinants are:

  1. Nature of the commodity:  That is, whether the commodity is a

necessity or luxury.  Necessary goods have inelastic demand while
luxury goods have elastic demand.

  1. Substitutes:  Commodities having substitutes have more elastic demand

while those without substitutes have inelastic demand.

  1. Number of uses:  Commodities with variety of uses have elastic demand.

 

  1. Habits:  Goods consumed as habits have inelastic demand.
  1. Consumer’s income:  Where the percentage of customers’ income spent

on a commodity is large, demand tends to be price elastic and vice versa.

 

 

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