The correct answer is Option (1) → Zero
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Price Elasticity of Demand (PED) measures how much the quantity demanded of a commodity changes in response to a change in its price.
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If demand remains constant regardless of any change in price, then there is no response to price — meaning:
Elasticity (Eₚ)=% change in quantity demanded/ % change in price =0
- This is called perfectly inelastic demand, and its elasticity is zero.
- Example: Life-Saving Medicine (e.g., Insulin). Suppose a person with diabetes needs 1 unit of insulin daily to survive. Whether the price of insulin increases from ₹500 to ₹5000 or drops to ₹50, the patient will still need exactly 1 unit per day — not more, not less. So, quantity demanded remains constant despite any change in price.
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