Question

elasticity of demand equal to infinity incase of (a) luxury (b) necessary (c) perfect competition (d) Normal goods


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Answer 1

Answer:

There are two extreme cases of elasticity: when elasticity equals zero and when it is infinite. A third case is that of constant unitary elasticity. We will describe each case.

Infinite elasticity or perfect elasticity refers to the extreme case where either the quantity demanded (Qd) or supplied (Qs) changes by an infinite amount in response to any change in price at all.