The demand curve for physician office visits is quite inelastic; therefore, a:
A) large increase in price causes quantity demanded to decrease by very little.
B) large decrease in price causes quantity demanded to decrease by a lot.
C) small increase in price causes quantity demanded to decrease by a lot.
D) small decrease in price causes quantity demanded to decrease by very little.

Question

Quizplus · Accepted Answer

The demand curve for physician office visits being inelastic indicates that a change in price will not have a significant effect on the quantity demanded. Therefore, a large increase in price will cause only a very small decrease in quantity demanded. Conversely, a large decrease in price will not significantly increase the quantity demanded, as customers typically do not dramatically increase their usage of physician office visits simply because of a small price drop.

The Demand Curve for Physician Office Visits Is Quite Inelastic;