Exhibit 5-4 Demand curves for silver Assume that a wealthy buyer, Mr. Hunt, declares that he will purchase any amount of silver at a price of $125 an ounce. In Exhibit 5-4, which graph illustrates the shape of the demand curve for silver?
A) Graph A.
B) Graph B.
C) Graph C.
D) Graph D.

Question

Exhibit 5-4  Demand curves for silver  Assume that a wealthy buyer, Mr. Hunt, declares that he will purchase any amount of silver at a price of $125 an ounce. In Exhibit 5-4, which graph illustrates the shape of the demand curve for silver?
A) Graph A. 
B) Graph B. 
C) Graph C. 
D) Graph D.

Quizplus · Accepted Answer

Graph A represents a perfectly inelastic demand curve, which means that regardless of the price, the quantity demanded remains the same. In this case, Mr. Hunt has declared that he will purchase any amount of silver at a price of $125 an ounce, which fits the description of a perfectly inelastic demand curve.

Exhibit 5-4 Demand Curves for Silver Assume That a Wealthy