JAMB Economics 2013 Paper

Concept:Price elasticity of demand measures how strongly quantity demanded responds to a change in price.Explanation:The demand curve is a vertical straight line, so quantity demanded remains constant at $Q_0$ at every price level.When price changes, the percentage change in quantity demanded is zero:$$E_d = \frac{\% \Delta Q_d}{\% \Delta P} = \frac{0}{\% \Delta P} = 0.$$Therefore, demand does not respond to price changes.Answer:C. perfectly inelastic