When the price elasticity of demand is small in magnitude,a _____ increase in the price leads to a _____ reduction in the amount purchased and the demand curve is relatively ____.
A) slight; substantial; steep
B) slight; slight; flat
C) large; slight; steep
D) slight; substantial; flat

Question

Quizplus · Accepted Answer

When the price elasticity of demand is small in magnitude, it indicates that demand is inelastic. This means that a large increase in price leads to only a slight reduction in the quantity demanded, and the demand curve is relatively steep.

When the Price Elasticity of Demand Is Small in Magnitude,a