Which of the following statements correctly differentiates between the slope of a demand curve and the price elasticity of demand along a linear demand curve?
A) The price elasticity of demand for a good is the same at different points on the demand curve, whereas the slope of the demand curve varies depending on the point where it is measured.
B) The price elasticity of demand for a good varies along the demand curve, whereas the slope of the demand curve remains the same at different points on the curve.
C) The price elasticity of demand is a unit-free measure, whereas the slope of a demand curve is measured in dollars.
D) The price elasticity of demand is measured in dollars, whereas the slope of a demand curve is a unit-free measure.

Question

Quizplus · Accepted Answer

The slope of a demand curve measures the change in quantity demanded for a given change in price, whereas the price elasticity of demand measures the responsiveness of quantity demanded to changes in price. Along a linear demand curve, the slope remains the same but the price elasticity of demand varies, with higher elasticities at the flatter portions of the curve and lower elasticities at the steeper portions. Therefore, option B correctly differentiates between the two concepts.

Which of the Following Statements Correctly Differentiates Between the Slope