Which is true of the graphs? ### Understanding Demand Elasticity**Question: Which is true of the graphs?**#### Description of the Graphs- **Graph A**: This graph depicts a downward-sloping demand curve. The steepness suggests that demand is quite responsive to changes in price, indicating elastic demand. As price decreases, quantity demanded increases significantly, and vice versa.- **Graph B**: This graph shows a nearly vertical demand curve. The steepness suggests that demand is less responsive to changes in price, indicating inelastic demand. Even as price increases or decreases, the quantity demanded remains relatively constant.**Question: Which graph shows inelastic demand?**- **Options:** 1. Graph B shows that when the price increases, demand increases. 2. Graph B shows that we will buy the product regardless of price. 3. Graph A shows that when the price increases, we will no longer demand the product. 4. Graph A shows that we will buy the product regardless of price.**Explanation:**- Graph B illustrates inelastic demand, where the quantity demanded does not change significantly with price changes (Option 2 is correct for inelastic demand).- Graph A shows elastic demand, where demand is sensitive to price changes (Option 3 could describe elastic demand behavior).Understanding these concepts can aid in grasping how businesses set pricing strategies and predict consumer behavior in various economic scenarios.

Which is true of the graphs? GRAPH A GRAPH B Which graph shows inelastic demand? O Graph B shows that when the price increases demand increases. O Graph B shows that we will buy the product regardless of price O Graph A shows that when the price increases, we will no longer demand the product. O Graph A shows that we will buy the product regardless of price

Which is true of the graphs? GRAPH A GRAPH B Which graph shows inelastic demand? O Graph B shows that when the price increases demand increases. O Graph B shows that we will buy the product regardless of price O Graph A shows that when the price increases, we will no longer demand the product. O Graph A shows that we will buy the product regardless of price

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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