For a downward-sloping straight-line demand curve, the top portion of the curve is generally
A) perfectly elastic.
B) elastic.
C) unit elastic.
D) inelastic.
E) perfectly inelastic.

Question

Quizplus · Accepted Answer

For a downward-sloping straight-line demand curve, the top portion of the curve is generally elastic because a small change in price can cause a relatively large change in quantity demanded. As we move down the demand curve, the slope becomes steeper and elasticity decreases. At the midpoint of the curve, elasticity is unit elastic, and at the bottom portion of the curve, it is inelastic. However, since the question is asking specifically about the top portion of the curve, the answer is B) elastic.

For a Downward-Sloping Straight-Line Demand Curve, the Top Portion of the Curve