question archive As the demand curve gets steeper (more vertical), a
As the demand curve gets steeper (more vertical), a
Subject:EconomicsPrice:2.88 Bought3
As the demand curve gets steeper (more vertical),
a. demand becomes more price inelastic and the price elasticity of demand approaches zero.
b. demand becomes more price inelastic and the price elasticity of demand approaches negative infinity.
c. demand becomes more price elastic and the price elasticity of demand approaches negative infinity.
d. demand becomes more price elastic and the price elasticity of demand approaches zero.
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The correct option is a. demand becomes more price inelastic and the price elasticity of demand approaches zero.
A steep demand curve means that large changes in price cause relatively small changes in demand. This means that the demand is inelastic. As the demand curve becomes even steeper, the demand approaches perfect inelasticity at which point the elasticity of demand is equal to zero.
