WASSCE Economics · Paper 1 style

Elasticity

One sample question with the full working. 1 more in the app, with instant feedback and repair sessions for the traps below.

Demand for salt is price inelastic mainly because

Asalt is a luxury
Bit is a necessity that takes a small part of income
Cit has many close substitutes
Dit is produced in Ghana

Show the answer and working

Answer: B

Necessity + small share of income → inelastic.

Trap A Confuses types of elasticity: Income elasticity: + normal, − inferior. Cross elasticity: + substitutes, − complements. PED is usually negative; |PED| compared with 1.

Trap C Reverses the direction of the effect: Trace the chain step by step (e.g. buying securities → banks gain cash → money supply rises) and check the sign at every link.

Trap D Chooses a true but irrelevant statement: Re-read the question's key term and test each option against it, not against whether it is true in general.

Traps in Elasticity

Confuses types of elasticity
Income elasticity: + normal, − inferior. Cross elasticity: + substitutes, − complements. PED is usually negative; |PED| compared with 1.
Reverses the direction of the effect
Trace the chain step by step (e.g. buying securities → banks gain cash → money supply rises) and check the sign at every link.
Chooses a true but irrelevant statement
Re-read the question's key term and test each option against it, not against whether it is true in general.

Practise Elasticity (1 questions)Send to your class on WhatsApp