Question : A product has an initial quantity demanded of 120 units at a price of INR 12 per unit. Due to a price change, the new price is INR 10 per unit, and the new quantity demanded is 160 units. Calculate the percentage change in price.
Option 1: -10%
Option 2: -12.5%
Option 3: -16.7%
Option 4: -20%
Correct Answer: -16.7%
Solution : The correct answer is (c) -16.7%
Percentage change in price = [(New price - Initial price) / Initial price] * 100%
Given that the initial price is ₹12 per unit and the new price is ₹10 per unit, we can substitute these values into the formula:
Percentage change in price = [ (10 - 12) / 12 ] * 100%
= [ (-2) / 12 ] * 100%
= (-1/6) * 100%
= -16.7%
Therefore, the percentage change in price is -16.7%.
