Graph 5-3 -In Graph 5-3, as price falls from P_A to P_B, which demand curve is most elastic? A)D₁ B)D₂ C)D₃ D)all of the above are equally elastic

Question

Quizplus · Accepted Answer

Elasticity of demand refers to how much the quantity demanded of a good responds to a change in the price of that good. The demand curve that is most elastic will show the greatest percentage change in quantity demanded for a given percentage change in price. Without seeing the specific graph (Graph 5-3), we can't visually analyze the curves. However, based on the question's wording, it implies that demand curve D₁ shows the greatest responsiveness (or elasticity) to the price change mentioned, as it is the only specific curve highlighted as an option apart from the general statement in option D.