Multiple choice

The point elasticity at the mid-point on the demand curve is

  1. one

  2. zero

  3. less than one

  4. more than one

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A Correct answer
Explanation

At the exact midpoint of a linear demand curve, point elasticity equals 1 (unit elastic). This is a mathematical property of linear demand curves - the midpoint divides the curve into an elastic portion (above midpoint) and inelastic portion (below midpoint).