Question : If a demand curve is VERTICAL, the following equation represents the own-price elasticity of demand for this good:
Option 1: The infinite
Option 2: Zero
Option 3: One
Option 4: None of the above
Correct Answer: Zero
Solution : The same quantity of items is sought at every price level when the demand curve is vertical to the axis. This further implies that a change in price has no impact on the quantity that is required. As a result, the product is quantitatively perfectly inelastic and demand elasticity is zero. Hence option b is the correct answer.
Question : The horizontal and parallel to the x-axis demand curve indicates that the elasticity of demand is____.
Option 1: Infinite
Option 3: Greater than zero
Option 4: Equals to one
Question : Which one is not the type of elasticity of demand?
Option 1: Price elasticity of demand
Option 2: Income elasticity of demand
Option 3: Cross elasticity of demand
Option 4: Consumer elasticity of demand
Question : A demand curve, which is parallel to the horizontal axis, showing quantity, has a price elasticity equal to
Option 1: zero
Option 2: one
Option 3: less than one
Option 4: infinite
Question : The price elasticity of demand for a perfectly elastic demand curve is:
Option 1: 0
Option 2: 1
Option 3: Greater than 1
Option 4: Infinite
Question : The elasticity of demand for luxury goods is:
Option 1: Less than one
Option 2: More than one
Option 3: Zero
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile