FIGURE 4-1
-Refer to Figure 4-1,which shows two demand curves,one linear and the other a rectangular hyperbola.In diagram 1,the price elasticity of demand
A)at point A is equal to that at point C.
B)at point A is less than at point C.
C)at point A is greater than at point C.
D)is equal at points A,B,and C.
E)at point A is equal to that at point B.

Question

FIGURE 4-1
-Refer to Figure 4-1,which shows two demand curves,one linear and the other a rectangular hyperbola.In diagram 1,the price elasticity of demand
A)at point A is equal to that at point C. 
B)at point A is less than at point C. 
C)at point A is greater than at point C. 
D)is equal at points A,B,and C. 
E)at point A is equal to that at point B.

Quizplus · Accepted Answer

Point A on the rectangular hyperbola demand curve is at the steepest part, indicating a higher price elasticity of demand compared to point C which is flatter. In contrast, the linear demand curve has a constant price elasticity of demand, therefore the price elasticity of demand at point A is greater than that at point C.

FIGURE 4-1 -Refer to Figure 4-1,which Shows Two Demand Curves,one Linear and Linear