The price elasticity of a demand curve with a constant slope:
A) is equal to the slope.
B) is greater than the slope.
C) is less than the slope.
D) increases in absolute value as the price rises.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures how much the quantity demanded of a good responds to a change in the price of that good. For a demand curve with a constant slope, the price elasticity of demand increases in absolute value as we move up the curve (i.e., as the price rises), because the percentage change in quantity demanded becomes larger relative to the percentage change in price.

The Price Elasticity of a Demand Curve with a Constant