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#cfa #cfa-level-1 #economics #microeconomics #reading-13-demand-and-supply-analysis-introduction #study-session-4
Certainly, there could be no demand curve that is perfectly vertical at all possible prices, but over some range of prices it is not unreasonable that the same quantity would be purchased at a slightly higher price or a slightly lower price.
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4.1. Own-Price Elasticity of Demand
points: vertical demand curves and horizontal demand curves. Consider a vertical demand curve, as in Exhibit 21 Panel A, and a horizontal demand curve, as in Panel B. In the first case, the quantity demanded is the same, regardless of price. <span>Certainly, there could be no demand curve that is perfectly vertical at all possible prices, but over some range of prices it is not unreasonable that the same quantity would be purchased at a slightly higher price or a slightly lower price. Perhaps an individual’s demand for, say, mustard might obey this description. Obviously, in that price range, quantity demanded is not at all sensitive to price and we would say that de


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