Final answer:
The correct answer is option c. The elasticity coefficient varies along a straight-line demand curve sloping downward. On this type of curve, price elasticity of demand changes at different points, contrasting with perfectly inelastic or perfectly elastic demand curves where it remains constant. Therefore, the correct option is a straight-line demand curve sloping downward.
Step-by-step explanation:
The elasticity coefficient, which measures how responsive the quantity demanded or supplied is to a change in price, certainly varies along different types of demand curves. To clarify, elasticity is not the same as the slope of a demand curve. The question at hand specifically asks about the variability of the elasticity coefficient among different demand curves.
A vertical demand curve is described as perfectly inelastic, where elasticity is zero, meaning that there is no response to a change in price (Figure 5.5). A horizontal demand curve represents a perfectly elastic situation where even a small change in price would lead to an infinite change in the quantity demanded. The elasticity in such a case would be infinitely large.
On a straight-line demand curve sloping downward, the elasticity coefficient will indeed vary. It is a common misconception to confuse the slope of a demand or supply curve with its elasticity; they are not the same. Elasticity measures the percentage change in quantity demanded relative to a percentage change in price and can vary different points along a straight-line demand curve. For instance, the price elasticity changes between different points along the curve in Figure 5.2, where it was 0.45 between points A and B and increased to 1.47 between points G and H.
Therefore, the correct option regarding where the elasticity coefficient will vary is a straight-line demand curve sloping downward.