Jenna runs a small boutique in Capitola.She tells one of her suppliers that she is willing to pay $6 for a pair of wool hand warmers and not a dime more.On the basis of this information, what can you conclude about her price elasticity of demand for wool hand warmers?
A)It is elastic.
B)It is perfectly elastic.
C)It is perfectly inelastic.
D)The price elasticity coefficient is 0.

Question

Quizplus · Accepted Answer

Jenna's statement indicates that she will only buy the hand warmers at exactly $6 and not at any other price, which is characteristic of perfectly elastic demand.

Jenna Runs a Small Boutique in Capitola