Questions: A demand curve that is completely elastic is Downward-sloping. Horizontal. Vertical. Upward-sloping.

A demand curve that is completely elastic is
Downward-sloping.
Horizontal.
Vertical.
Upward-sloping.
Transcript text: A demand curve that is completely elastic is Downward-sloping. Horizontal. Vertical. Upward-sloping.
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Solution

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The answer is the second one: Horizontal.

Explanation for each option:

  1. Downward-sloping: A downward-sloping demand curve indicates that as the price decreases, the quantity demanded increases. This is typical for most goods and services, but it does not represent a completely elastic demand.

  2. Horizontal: A horizontal demand curve represents a situation where the demand is perfectly elastic. This means that consumers are willing to purchase any quantity of the good at a specific price, but if the price changes even slightly, the quantity demanded will drop to zero. This is the correct representation of a completely elastic demand curve.

  3. Vertical: A vertical demand curve indicates perfectly inelastic demand, where the quantity demanded does not change regardless of the price. This is the opposite of a completely elastic demand.

  4. Upward-sloping: An upward-sloping demand curve is atypical and generally not observed in standard economic models. It would imply that as the price increases, the quantity demanded also increases, which contradicts the law of demand.

In summary, a completely elastic demand curve is horizontal, indicating that consumers will only buy at one price and any deviation from this price will result in zero quantity demanded.

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