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If a product's price falls and the consumer buys 4 units, as they did before the price change, then the:

A. Demand is elastic
B. Demand is inelastic
C. Supply is elastic
D. Supply is inelastic

1 Answer

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Final answer:

When the price of a product decreases and the consumer's purchasing behavior remains unchanged, the demand for that product is classified as inelastic.

Step-by-step explanation:

If a product's price falls and the consumer buys the same number of units as before, then the demand is considered inelastic. This categorization means that the quantity demanded does not respond strongly to a price change. In the given scenario, since the consumer continued to purchase 4 units regardless of the lower price, their demand did not increase in response to the price decrease, indicating that the demand is inelastic.

In this scenario, the consumer buys the same quantity of the product despite the price change. This indicates a low responsiveness to price changes, which corresponds to inelastic demand. Even though the price fell, the consumer's demand remained constant.

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