When Demand Is Perfectly Inelastic,the Demand Curve Will Be

question 251

Multiple Choice

When demand is perfectly inelastic,the demand curve will be

• A)negatively sloped,because buyers decrease their purchases when the price rises.
• B)vertical,because buyers purchase the same amount as before whenever the price rises or falls.
• C)positively sloped,because buyers increase their purchases when price rises.
• D)positively sloped,because buyers increase their total expenditures when price rises.

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Definitions:

Operating Leverage

Operating leverage is a measure of how revenue growth translates into growth in operating income, highlighting the impact of fixed costs on profitability.

Net Operating Income

A company's income after operating expenses are subtracted but before interest and taxes are deducted.

Percentage Change

A mathematical calculation that represents the degree of change over time, usually expressed as a percent.

Target Profit

The desired profit a company aims to achieve for a particular product or service over a certain period.