The price elasticity of demand faced by an individual wheat farmer would come closest to which following value?
A)0.00007
B)0.7
C)1.0
D)71.0
E)71 000

Question

Quizplus · Accepted Answer

The price elasticity of demand for an individual wheat farmer is extremely high because wheat is a homogeneous product, and individual farmers are price takers in a perfectly competitive market. Therefore, the demand curve they face is nearly perfectly elastic.

The Price Elasticity of Demand Faced by an Individual Wheat