CBSE Class 12 Business Studies 2021 Outside Delhi set 1
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Question : 43 of 60
Marks:
+1,
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For the following two statements, choose the correct option:
Statement I: If the demand of a product is inelastic, the firm is in a position to fix higher prices.
Statement II : In case the degree of competition is high, the firm is in position to set high prices.
Choose the correct option from options given below:
Statement I: If the demand of a product is inelastic, the firm is in a position to fix higher prices.
Statement II : In case the degree of competition is high, the firm is in position to set high prices.
Choose the correct option from options given below:
Solution:
(a) Statement I is correct and Statement II is wrong.
Statement- I is correct. If the demand of a product is inelastic, the firm is in a position to fix higher prices, as the percentage increase in price will result in a smaller percentage decrease in the quantity demanded.
Statement- I is correct. If the demand of a product is inelastic, the firm is in a position to fix higher prices, as the percentage increase in price will result in a smaller percentage decrease in the quantity demanded.
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