What is the correct answer?


For a few products such as insulin for diabetics,:

A. The demand curve can be upward sloping

B. The price elasticity of demand could be zero

C. The price elasticity of demand could be greater than one

D. None of the above

Correct Answer :

B. The price elasticity of demand could be zero

For such products it is possible for the demand curve to be vertical (completely inelastic) with price elasticity equal to zero. The reason is that the use of insulin is very necessary for diabetic patients and they would buy the same amount of insulin on any level of price.}

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