Q. 35.0( 2 Votes )

What is the value of the MR when the demand curve is elastic?

Answer :

The relationship between MR and elasticity of demand is given by –

MR = P (1 – 1/Ed)


When demand curve is elastic, i.e. Ed > 1, the MR will be positive because for any value of Ed, 1/Ed will be less than 1.


The graph representing it is given below –



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