When will increase in supply bring down the price, leaving the quantity demanded unchanged?

When the demand for the commodity is perfectly elastic.

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When the demand for the commodity is perfectly inelastic.

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When the demand for the commodity is relatively elastic.

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When demand for the commodity is unitary elastic.

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Solution

The correct option is B When the demand for the commodity is perfectly inelastic.
When the demand for a commodity is perfectly inelastic the change in price will have no effect on the quantity demanded. The consumers do not change their demand due to the change in price. This usually is seen in case of necessities. Hence, the equilibrium quantity will be same the price might increase or decrease.

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