Question

On the basis of graph given above answer next 5 questions.
At curve D $D_1$ elasticity is _________.

• A. $E_d>1$
• B. $E_d<1$
• C. $E_d=1$
• D. $E_d=\infty$

Answer 1

The correct option is D $E_d=\infty$

$\Rightarrow$ In the given curve x-axis shows quantity and y-axis shows price.

$\Rightarrow$ In given curve $D{D}_1,$ we can see its a horizontal line where quantity of demand is changes and price remains constant.

$\Rightarrow$ If quantity changes and price remains constant then, $E_d=\infty$ and the result is know as perfectly elastic demand.

$\therefore$ At curve $D{D}_1$ elasticity is $E_d=\infty .$