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Infinite, or perfect, elasticity. What does this term mean?
AQuantity demanded or supplied never changes no matter how large the price change
BPrice and quantity always change by exactly the same percentage
CQuantity demanded changes only when income, not price, changes
DQuantity demanded or supplied changes by an infinite amount for any change in price at all
Answer & Solution
Correct answer: D. Quantity demanded or supplied changes by an infinite amount for any change in price at all
1. Infinite elasticity is one of the two extreme polar cases .
2. It means quantity demanded or supplied changes by an infinite amount in response to any price change at all, however small.
3. A quantity that never changes regardless of price is the opposite extreme, zero elasticity, not infinite elasticity.
4. Infinite elasticity concerns the response to price, not to income.
_Source: OpenStax Principles of Microeconomics for AP Courses (CC BY 4.0), Ch 5 "Elasticity", section 5.2 | Polar Cases of Elasticity and Constant Elasticity_
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