What is the meaning of perfectly inelastic demand and perfectly elastic demand? How would each be graphed?
Please provide the best answer for the statement.
Perfectly inelastic demand indicates that there is no change in quantity demanded for a percentage change in price. The elasticity of demand is zero in this case. The graph, with price on the vertical axis and quantity on the horizontal axis, would be a vertical line at the level of quantity demanded. Perfectly elastic demand indicates that a very small change in price results in a zero to infinite change in quantity demanded. The elasticity of demand is infinite in this case. The graph, with price on the vertical axis and quantity on the horizontal axis, would be a horizontal line across quantity at one price level.
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a. 0 b. 10 c. 100 d. 1 e. 0.01
Other things constant, an increase in the real GDP of a country will: a. increase the price level
b. shift the demand for money curve rightward. c. shift the demand for money curve leftward. d. decrease the nominal interest rate. e. decrease the quantity of money demanded.