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Question
With the help of a graph explain a perfectly inelastic demand curve.
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Solution
Perfectly Inelastic Demand: When the quantity demanded does not change at all as a result of a change in the price of the commodity, the demand for that commodity is said to be perfectly inelastic. In such a case, quantity demanded is independent of price changes.
Demand here is nonresponsive and the numerical value of price elasticity (Ed) will be zero. The demand curve will be parallel to the Y-axis as shown in Figure. In the figure, demand (OQ) is fixed. If price increases or decreases, it still remains unchanged. This type of situation is normally not found in real life.
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