Question

True or false? The graph below represents a case of constant unitary elasticity of demand. 25% 35% 3095 30% Price 35% 329 30% Demand

Answer 1

False,

Constant unitary elasticity, in a demand curve, occurs when a price change of one percent results in a quantity change of one percent.

However we can see at point A to point B the reduction in price is 25% while the increase in quantity is 35%. so for unitary constant elasticity it has to a 25% increment in demand due to a 25% decrease in price.

so this demand curve does not have a constant unitary elasticity.