If the demand curve for a good is given by the equation , where q is quantity and p is price, then at any positive price, the elasticity of demand will be -1.

Question

If the demand curve for a good is given by the equation  , where q is quantity and p is price, then at any positive price, the elasticity of demand will be -1.

Quizplus · Accepted Answer

The elasticity of demand for a good at any point on the demand curve can be calculated using the formula

Elasticity of Demand = (% change in quantity demanded) / (% change in price)

Taking the derivative of the demand equation with respect to price, we get:

dQ/dP = -2P/11

Plugging in the given equation, we get:

Elasticity of Demand = (P/Q) * (-2P/11) = -2P^2/(11Q*P) = -2P/11

Since the elasticity of demand is a constant value of -2/11, it is not equal to -1 at any price. Therefore, the statement is false.

If the Demand Curve for a Good Is Given by the Equation