NN is more elastic between points A and D than curve MM is between points A and C. True.
Between points A and D, curve NN is inelastic. True.
Between points A and E, curve OO is perfectly elastic. True.
Explanation:
In Economics, elasticity is the estimation of the relative difference in a monetary variable because of an adjustment in another. It shows how simple it is for the provider and buyer to change their conduct and substitute another great, the quality of a motivating force over decisions per the relative open door cost.
Elasticity of demanded quantifies how the measure of good changes when its cost goes up or down. Flexibility is a proportion of the affectability of factors to a modification in another variable.
The statement 1 and 3 are false and the statement 2 is true with regards to elasticity of demand.
Elasticity of demand refers to the change in quantity demanded of a product with respect to changes in other factors.
The elasticity may be represented graphically by way of a demand curve. The curve for perfectly elastic demand is parallel to x-axis and the same for perfectly inelastic demand is parallel to y-axis.
The flatness of the curve denotes its elasticity. Flatter the curve, more will be the elasticity, and steeper the curve less will be the elasticity.
In the figure, the curve MM is more flat than curve NN, therefore MM is more elastic. Hence, statement 1 is false.
The curve NN is steeper at points A and D, hence it is inelastic. Therefore statement 2 is true.
The curve OO is parallel to y-axis, that means it is perfectly inelastic. Therefore statement 3 is false.
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