Use the following to answer questions:
Figure: The Linear Demand Curve II
-(Figure: The Linear Demand Curve II) Look at the figure Linear Demand Curve II. At prices greater than $7, demand is _____; at prices below $7 demand is _____; and at $7 demand is _____.
A) elastic; inelastic; unit-elastic
B) inelastic; elastic; unit-elastic
C) unit-elastic; inelastic; elastic
D) equal to 0; elastic; inelastic

Question

Use the following to answer questions:
Figure: The Linear Demand Curve II 
-(Figure: The Linear Demand Curve II) Look at the figure Linear Demand Curve II. At prices greater than $7, demand is _____; at prices below $7 demand is _____; and at $7 demand is _____.
A) elastic; inelastic; unit-elastic 
B) inelastic; elastic; unit-elastic 
C) unit-elastic; inelastic; elastic 
D) equal to 0; elastic; inelastic

Quizplus · Accepted Answer

At prices greater than $7, the percentage change in quantity demanded is greater than the percentage change in price, making demand elastic. At prices below $7, the percentage change in quantity demanded is less than the percentage change in price, making demand inelastic. At $7, the percentage change in quantity demanded is equal to the percentage change in price, making demand unit-elastic.

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