The figure above shows the demand curve for Starbucks latte.
-In the figure above,the demand is elastic in the range of prices between
A) $3.50 and $4.50 per cup.
B) $2.50 and $3.50 per cup.
C) $1.00 and $2.00 per cup.
D) $2.00 and $4.00 per cup.
E) $1.75 and $2.75 per cup.

Question

The figure above shows the demand curve for Starbucks latte.
-In the figure above,the demand is elastic in the range of prices between
A) $3.50 and $4.50 per cup. 
B) $2.50 and $3.50 per cup. 
C) $1.00 and $2.00 per cup. 
D) $2.00 and $4.00 per cup. 
E) $1.75 and $2.75 per cup.

Quizplus · Accepted Answer

The demand is elastic when the percentage change in quantity demanded is greater than the percentage change in price. In the given figure, the demand is elastic in the range of prices between $3.50 and $4.50 per cup because the percentage change in quantity demanded is greater than the percentage change in price in this range.

The Figure Above Shows the Demand Curve for Starbucks Latte