In the price range from 6 to 8 and from 8 to 6, elasticity status is both elastic.

In the price range from 6 to 8 and from 8 to 6, elasticity status is both elastic.

• A. Inelastic; inelastic
• B. Elastic; inelastic
• C. Elastic; elastic
• D. Inelastic; elastic

Answer: (C)

The key idea here is how elasticity is measured over a specific price interval. On a linear (straight-line) downward-sloping demand curve, the slope is constant, so the arc elasticity over a fixed price range depends on the interval itself, not on the direction of the price change. When you look at the same interval in opposite directions (from 6 to 8 and from 8 to 6) you use the same average price and average quantity in the arc elasticity calculation, which makes the magnitude of elasticity the same in both directions. If that arc elasticity exceeds 1 in magnitude, the range is elastic in both directions. Since the statement says elasticity status is elastic in both directions for the price changes 6→8 and 8→6, the correct interpretation is that the interval lies in the elastic portion of the demand, so both directions are elastic.

The key idea here is how elasticity is measured over a specific price interval. On a linear (straight-line) downward-sloping demand curve, the slope is constant, so the arc elasticity over a fixed price range depends on the interval itself, not on the direction of the price change. When you look at the same interval in opposite directions (from 6 to 8 and from 8 to 6) you use the same average price and average quantity in the arc elasticity calculation, which makes the magnitude of elasticity the same in both directions.

If that arc elasticity exceeds 1 in magnitude, the range is elastic in both directions. Since the statement says elasticity status is elastic in both directions for the price changes 6→8 and 8→6, the correct interpretation is that the interval lies in the elastic portion of the demand, so both directions are elastic.