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The absolute value of the elasticity of demand at point A in the demand curve below is _________.

a. 1
b. 4
c. 2
d. 0.5

User Paul Solt
by
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1 Answer

5 votes

Final answer:

Without specific data for point A on the demand curve, we cannot determine the exact value of the absolute elasticity of demand at that point from the information given. The elasticity was reported as 0.45 between points A and B, indicating inelastic demand, and it became elastic with a value of 1.47 further up the curve between points G and H.

Step-by-step explanation:

The question relates to the concept of price elasticity of demand, which measures how the quantity demanded of a good responds to a change in price. From the given information, we know that the elasticity of demand between two points A and B was 0.45, indicating that the demand is inelastic in that interval since the absolute value is less than one. However, the elasticity value that we are looking for at point A is not explicitly provided in this information.

There is a general concept that as we move up along a straight-line demand curve, the absolute value of the elasticity increases. The elasticity increased to 1.47 between two points G and H, which are likely to be higher than A and B on the demand curve. Since the problem statement only indicates that the elasticity at point A is less than one, and without additional information or data it's not possible to determine the exact value, we cannot confidently select the correct answer choice among a. 1 b. 4 c. 2 d. 0.5. Hence, no definitive answer can be given based on the information provided.

User Eligolf
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