The accompanying graph depicts demand. At point D, demand is:
A)price inelastic.
B)price elastic.
C)unit elastic.
D)perfectly price elastic.

Name: The accompanying graph depicts demand. At point D, demand is: A)price inelastic. B)price elastic. C)unit elastic. D)perfectly price elastic.
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Question

The accompanying graph depicts demand.    At point D, demand is:
A)price inelastic. 
B)price elastic. 
C)unit elastic. 
D)perfectly price elastic.

Quizplus · Accepted Answer

The formula for the price elasticity of demand at a given point is (P/Q)× (1/slope). Here, (2/10)× (1/0.5)= 2/5. Since this is less than one, demand is inelastic at point D.

The Accompanying Graph Depicts Demand