Arc elasticity of demand is used when:

CA Foundation · Business Economics · RTP · May 2026
Arc elasticity of demand is used when:
(A) A. Price change is infinitesimal
(B) B. Price change is large
(C) C. Demand curve is vertical
(D) D. Demand is perfectly elastic

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. Price change is large

Topics: Theory of Demand and Supply

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