A good is said to be highly inelastic if
A) the absolute value of the elasticity is 1.
B) the absolute value of the elasticity is greater than 1.
C) there is a small change in quantity with a change in price.
D) there is a large change in quantity with a change in price.

Question

Quizplus · Accepted Answer

When a good is highly inelastic, it means that the quantity demanded or supplied changes very little in response to changes in price. This is captured by option C, indicating a small change in quantity with a change in price. Elasticity measures how responsive the quantity demanded or supplied is to a change in price; inelastic goods have an elasticity value less than 1 in absolute terms, indicating less responsiveness.

A Good Is Said to Be Highly Inelastic If