A straight-line demand curve with negative slope intersects the horizontal axis at 200 tons per week. The point on the demand curve at which the price elasticity of demand is 1 corresponds to a quantity demanded
A) of 0 tons.
B) of 100 tons.
C) of 200 tons.
D) that would be negative if a negative quantity demanded were possible.

Question

Quizplus · Accepted Answer

The price elasticity of demand is 1 at the midpoint of a linear demand curve. Since the curve intersects the horizontal axis at 200 tons, the midpoint is at 100 tons.

A Straight-Line Demand Curve with Negative Slope Intersects the Horizontal