How would the demand have to change for a price change to be unitary elastic?

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1291810

2026-03-21 12:15

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For demand to be unitary elastic, the percentage change in quantity demanded must equal the percentage change in price. This means that if the price increases by a certain percentage, the quantity demanded should decrease by the same percentage, and vice versa. In this scenario, total revenue remains constant, as the loss in revenue from decreased sales is exactly offset by the higher price. Thus, the responsiveness of demand to price changes must be perfectly balanced.

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