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      Question

      The value of elasticity of demand in perfectly

      inelastic demand is?
      A One Correct Answer Incorrect Answer
      B Less than unity Correct Answer Incorrect Answer
      C Infinity Correct Answer Incorrect Answer
      D Zero Correct Answer Incorrect Answer

      Solution

      When the price elasticity of demand for a good is perfectly inelastic (Ed = 0), changes in the price do not affect the quantity demanded for the good; raising prices will always cause total revenue to increase.

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