If the percentage change in quantity demanded is exactly equal to the percentage change in price,then demand is:
A) Normal elastic.
B) Relatively inelastic.
C) Relatively elastic.
D) Unitary elastic.

Question

Quizplus · Accepted Answer

When the percentage change in quantity demanded is exactly equal to the percentage change in price, it indicates that demand is neither relatively elastic nor relatively inelastic. This type of demand is known as unitary elastic demand. It means that the change in price has an equal and opposite effect on the quantity demanded, resulting in a constant elasticity of demand. As a result, the total revenue remains constant with any change in price.

If the Percentage Change in Quantity Demanded Is Exactly Equal