In measuring elasticity,if e=0,then changes in price have no impact on demand,which is referred to as a ____ situation and occurs when the item being sold is rare or essential.
A) relatively elastic
B) perfectly inelastic
C) relatively inelastic
D) perfectly elastic

Question

Quizplus · Accepted Answer

When elasticity is equal to zero, it means that changes in price do not affect the quantity demanded at all. This is known as a perfectly inelastic situation, which is more likely to occur when the item being sold is rare or essential.

In Measuring Elasticity,if E=0,then Changes in Price Have No Impact