A demand curve that has constant price elasticity of demand coefficient equals to one at all points is a(n):
A) rectangular hyperbola.
B) downward-sloping straight line.
C) upward-sloping straight line.
D) none of the above.

Question

Quizplus · Accepted Answer

A demand curve with constant price elasticity of demand coefficient equal to one is a rectangular hyperbola. This means that the quantity demanded changes at the same rate as the price, resulting in a linear demand curve that is symmetrical around the origin. The elasticity of demand is always equal to 1, regardless of where on the curve we are measuring it.

A Demand Curve That Has Constant Price Elasticity of Demand