JAMB Economics 2019 Objective — Question 7

Question 7 of 40 from the Joint Admissions and Matriculation Board (JAMB) Economics 2019 Objective paper, with the correct answer and a full explanation.

If the demand elasticity coefficient of cars is 0.5, it implies that the demand for petrol is

A. elastic
B. perfectly inelastic
C. inelasticCorrect
D. perfectly elastic

Explanation

Cars and petrol are jointly demanded, so they tend to share the same demand elasticity coefficient. A coefficient of 0.5 (less than 1) implies that the demand for petrol is inelastic.

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