Exhibit 5.7

-Refer to Exhibit 5.7,which shows four demand curves.The demand curve that best illustrates how consumers will respond to a change in price over the long run is _____
A)curve D(1).
B)curve D(2).
C)curve D(4).
D)curve D(3).
E)curve D(1) or curve D(4).

Question

Exhibit 5.7
 
-Refer to Exhibit 5.7,which shows four demand curves.The demand curve that best illustrates how consumers will respond to a change in price over the long run is _____
A)curve D(1). 
B)curve D(2). 
C)curve D(4). 
D)curve D(3). 
E)curve D(1) or curve D(4).

Quizplus · Accepted Answer

Curve D(3) is the flattest of the four demand curves, indicating that consumers are more price insensitive and can still demand a significant amount of the good even if the price increases. This suggests that over the long run, consumers may have limited substitutes or are loyal to the product, making their demand less responsive to changes in price.

Exhibit 5.7 -Refer to Exhibit 5.7,which Shows Four Demand Curves.The Demand Curve