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WAEC Economics 1988 Question 33

Question 33

Elasticity

The coefficient of price elasticity of demand is zero when demand is

  1. A.fairly elastic
  2. B.perfectly inelastic
  3. C.fairly inelastic
  4. D.unitary elastic
  5. E.perfectly elastic.
Show the answer and explanation

Answer: B (perfectly inelastic)

Explanation

Elasticity is zero when quantity demanded does not change at all as price changes, i.e. perfectly inelastic demand.