If the quantity of concert tickets sold decreases by 10 percent when the price increases by 5 percent, this market is operating in which section of its downward-sloping straight-line demand curve?
A) the section above the point of unit elasticity
B) the point equal to unit elasticity
C) the section below the point of unit elasticity
D) This market show elastic demand which could occur at any point along the demand curve.

Question

Quizplus · Accepted Answer

The market is operating in the section above the point of unit elasticity because the percentage decrease in quantity demanded (10%) is greater than the percentage increase in price (5%), indicating that the demand is elastic in this section of the curve.

If the Quantity of Concert Tickets Sold Decreases by 10