Price elasticity of demand along a linear, downward-sloping demand curve decreases as price falls.

Question

Quizplus · Accepted Answer

As you move down a linear, downward-sloping demand curve, the quantity demanded increases while the price decreases. This means the percentage change in quantity demanded becomes larger relative to the percentage change in price as you move down the curve, leading to a decrease in the price elasticity of demand.

Price Elasticity of Demand Along a Linear, Downward-Sloping Demand Curve