The table gives the demand schedule for peas. Moving from point C to point D, the price elasticity of demand is:

The table gives the demand schedule for peas. Moving from point C to point D, the price elasticity of demand is:

• A. 3.00.
• B. elastic.
• C. 0.75.
• D. unit elastic.

Answer: (C)

Price elasticity of demand measures how much quantity demanded responds to a price change. Moving from C to D yields an elasticity of 0.75, meaning a 1% price change leads to about a 0.75% change in quantity demanded. Since this is less than 1, the quantity responds less than proportionately to price changes, so demand is inelastic on this segment. The value 0.75 is the correct match. A value of 3.00 would indicate elastic demand (much more responsive), and a value of 1.00 would indicate unit elastic (proportional response).

Price elasticity of demand measures how much quantity demanded responds to a price change. Moving from C to D yields an elasticity of 0.75, meaning a 1% price change leads to about a 0.75% change in quantity demanded. Since this is less than 1, the quantity responds less than proportionately to price changes, so demand is inelastic on this segment. The value 0.75 is the correct match. A value of 3.00 would indicate elastic demand (much more responsive), and a value of 1.00 would indicate unit elastic (proportional response).