Refer to Figure 20.2.Suppose the areas 0P₁AB and 0P₂CD are equal.We can conclude that the price elasticity of demand between point A and point C is A)Elastic. B)Inelastic. C)Unitary elastic. D)Impossible to determine.It depends on whether the price has increased or decreased.

Question

Quizplus · Accepted Answer

If the areas are equal, then it implies that the percentage change in price is equal to the percentage change in quantity demanded. This indicates a unitary elasticity of demand between point A and point C.