A-LevelEconomicsThe price system and the microeconomy9708/12 · May/June 2011 · Q71 Mark
The diagram shows the demand curve for a product with unitary price elasticity. What will happen with such a curve?
This question uses a diagram from the original paper, which isn't shown here. Open the full paper from the past papers archive to see it.
Afall in price will bring about an increase in expenditure on the product.
Bfall in price will bring about an increase in sales but a fall in expenditure on the product.
CAs the price rises, expenditure on the product stays the same.
DAs the price rises, expenditure on the product rises and then falls.
✓ Correct answer
C: As the price rises, expenditure on the product stays the same.
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