Exhibit 5-5 Demand curve for computers In Exhibit 5-5, if the area OABC equals the area ODEF, the demand curve is:
A) elastic.
B) inelastic.
C) unitary elastic.
D) nonelastic.

Question

Exhibit 5-5  Demand curve for computers  In Exhibit 5-5, if the area OABC equals the area ODEF, the demand curve is:
A) elastic. 
B) inelastic. 
C) unitary elastic. 
D) nonelastic.

Quizplus · Accepted Answer

When the areas OABC and ODEF are equal, it means that the price elasticity of demand is equal to 1 (unitary elastic). This occurs when a change in price results in a proportional change in quantity demanded, resulting in no change in total revenue.

Exhibit 5-5 Demand Curve for Computers in Exhibit 5-5, If