In the case of perfectly elastic demand, the demand curve is
A) upward sloping.
B) downward sloping.
C) vertical.
D) horizontal.

Question

Quizplus · Accepted Answer

In the case of perfectly elastic demand, any change in price will result in an infinite change in quantity demanded. This means that consumers are extremely price-sensitive and will stop buying the product if the price is even slightly higher than their maximum willingness to pay. Therefore, the demand curve is horizontal, indicating that at any given price, the quantity demanded can change to any level.

In the Case of Perfectly Elastic Demand, the Demand Curve