Home
Class 11
ECONOMICS
The price elastically of demand for life...

The price elastically of demand for life-saving drugs is inelastic. As a result, manufacture have the freedom to fix higher prices for them. How can this problem be handled?

Text Solution

Verified by Experts

This problem can be handled through government intervention.
(i) The government needs to control the prices of life-saving drugs. "The Essential Commodities Act, 1955" aims to ensure equitable distribution of essential commodities at reasonable price.
(ii) The government can also provide subsidy to firms so that they may charge less price for such items.
Promotional Banner

Topper's Solved these Questions

  • DEMAND AND ITS DETERMINANTS

    SANDEEP GARG|Exercise Model test paper 1|12 Videos

  • DEMAND AND ITS DETERMINANTS

    SANDEEP GARG|Exercise Model test paper 2|12 Videos

  • DEMAND

    SANDEEP GARG|Exercise Unsolved particles|4 Videos

  • ELASTICITY OF DEMAND

    SANDEEP GARG|Exercise Unsolved practicals|79 Videos

Similar Questions

Explore conceptually related problems

Suppose price elasticity of demand for a good is -0.2. How will the expenditure on good be affected if there is 10% increase in price of the good ?

Price elasticity of demand for a product is unity. Its demand is 25 units at a price of ₹ 5 per unit. If the price of product rises to ₹ 6 per unit, how much quantity of the product will be demanded ?

The coefficient of price elasticity of demand for a commodity is 0.2. when price was ₹ 10 per unit. The quantity demanded was 40 units. If the price falls to ₹ 5 per unit, how much will be its quantity demanded ?

The price elasticity of demand of good X si double the price elasticity of demand of Good Y . A 10% rise in the price of good Y results in fall in its demand by 60 units. If original demand of commodity Y was 400, calculate percentage rise in quantity demanded of good X when its when its price falls from ₹ 10 to ₹ 8 per unit.