Use the figure below to answer the following question(s).
Figure 7-6

Between $3 and $4, the price elasticity of the demand curve depicted in Figure 7-6 is
A) relatively inelastic.
B) approximately equal to − 0.33.
C) approximately equal to − 3.
D) both a and b.

Question

Use the figure below to answer the following question(s).
Figure 7-6

Between $3 and $4, the price elasticity of the demand curve depicted in Figure 7-6 is
A) relatively inelastic. 
B) approximately equal to − 0.33. 
C) approximately equal to − 3. 
D) both a and b.

Quizplus · Accepted Answer

Between $3 and $4, the demand curve is relatively steep, indicating that quantity demanded is not very responsive to changes in price. This means that the price elasticity of demand is relatively inelastic. Additionally, the slope of the demand curve between $3 and $4 is approximately equal to -0.33, indicating that for every 1% increase in price, quantity demanded will decrease by 0.33%. Therefore, the best answer is D, both a and b.

Use the Figure Below to Answer the Following Question(s)