Exhibit 9-2 Between which quantities in Exhibit 9-2 is demand unit elastic?
A)1 and 2
B)2 and 3
C)3 and 4
D)4 and 5
E)5 and 6

Question

Exhibit 9-2  Between which quantities in Exhibit 9-2 is demand unit elastic?
A)1 and 2 
B)2 and 3 
C)3 and 4 
D)4 and 5 
E)5 and 6

Quizplus · Accepted Answer

Demand is said to be unit elastic when the percentage change in quantity demanded is equal to the percentage change in price, resulting in a price elasticity of demand of 1. In Exhibit 9-2, the price elasticity of demand is equal to 1 only between quantities 3 and 4, where the price changes from $6 to $4 and the quantity demanded changes from 2 to 3. Therefore, choice C is the best answer.

Exhibit 9-2 Between Which Quantities in Exhibit 9-2 Is