The price elasticity of demand can range between

• A. Zero and infinity.
• B. Negative one and one.
• C. Zero and one.
• D. Negative infinity and infinity.

Answer: (A)

Elasticity of demand shows how much quantity demanded responds to a price change. In theory, demand can be completely unresponsive (a vertical demand curve, where quantity doesn’t change at all) or completely responsive (a horizontal demand curve, where any price change leads to a huge quantity change). That means the magnitude of the elasticity can range from 0 up to infinity. In practice the sign is negative for a typical downward-sloping demand, but when we talk about the range in a general sense, the relevant span is from zero to infinity.