The elasticity of the market demand curve is always _____.

A. less

B. Cannot be determined

C. equal

D. higher

• The elasticity of the market demand curve is always A. less.

The market demand curve is normally less elastic compared to the demand curve for an individual firm in the market. When a single firm hikes the price, the consumers will shift to other firms. This situation makes the demand curve for an individual firm more elastic. However, when the price for the whole market increases, consumers will still buy since they have no alternative, and hence the market demand curve is less elastic.