Scenario 5.1
The demand for noodles is given by the following equation: Q = 20 - 4P + 0.2I - 2P x . Assume that P = $8, I = 200, and P x = $10.
-Since the slope of a downward-sloping demand curve is constant, the price elasticity of demand does not change when moving along this line.

Question

Quizplus · Accepted Answer

The price elasticity of demand varies along a linear demand curve because it depends on the ratio of the change in quantity to the change in price, which changes as one moves along the curve.

Scenario 5.1 The Demand for Noodles Is Given by the Following Equation