Given the demand curves below 90 80 70 60 50 40 30 20 10 D2

Given the demand curves below: 90 80 70 60 50 40 30 20 10 D2 0 8 16 24 32 40 48 56 64 72 80 88 Quantity a) Which curve is more elastic at a price of $24? O Neither is elastic O D1 is more elastic O D2 is more elastic O D1 and D2 are equally elastic b) Which curve is more elastic at a price of $11? O Neither is elastic O D1 is more elastic O D2 is more elastic D1 and D2 are equally elastic

Solution

A.

The curve which is more flatter, that curve elasticity is more compare to steeper curve. Here at different price D2 is more elastic.

Hence D2 is more elastic at price 24.

Hence option third is the correct answer.

B.

Similarly at price $11, D2 is more elastic.

Hence option third is the correct answer.