Asked by Alejandra Navarro Borda on May 08, 2024
Verified
Refer to Figure 5.2. At Point C the price elasticity of demand is -1. Along line segment ________ of the demand curve, the demand is inelastic.
A) AC
B) BE
C) CF
D) AF
Price Elasticity
A metric evaluating the sensitivity of the amount of a good purchased to price fluctuations.
Demand Curve
A graph showing the relationship between the price of a product and the quantity of the product that consumers are willing to purchase.
- Recognize the portion of the demand curve reflecting elasticity categories (elastic, inelastic, unit elastic).
- Analyze charts depicting demand to assess elasticity.
Verified Answer
DW
Derek WilsonMay 13, 2024
Final Answer :
C
Explanation :
Along line segment CF of the demand curve, the demand is inelastic because it is below Point C, where the price elasticity of demand is -1. In this region, a change in price results in a smaller proportional change in quantity demanded, indicating inelastic demand.
Learning Objectives
- Recognize the portion of the demand curve reflecting elasticity categories (elastic, inelastic, unit elastic).
- Analyze charts depicting demand to assess elasticity.