Price Elasticity of Demand:
Price elasticity of demand measures the responsiveness of quantity demanded to a change in price. It helps determine how sensitive consumers are to changes in price.

Calculation:
To calculate the price elasticity of demand, we use the formula:

Elasticity = (% Change in Quantity Demanded) / (% Change in Price)

Given Information:
- Price has fallen by 40%.
- Quantity demanded has increased by 60%.

Calculating Elasticity:
Using the given information, we can calculate the price elasticity of demand as follows:

Elasticity = (60% / -40%) = -1.5

Since the elasticity coefficient is negative, it indicates that the commodity is a normal good (as the price and quantity demanded move in opposite directions).

Interpreting Elasticity:
The magnitude of the elasticity coefficient helps determine the degree of elasticity.

Explanation of Options:
a) Perfectly elastic: If the price elasticity of demand is infinite, it means that even a small change in price will cause an infinite change in quantity demanded. This is not the case here, so option 'A' is incorrect.

b) Unitary elastic: If the elasticity coefficient is equal to -1, it indicates that the percentage change in quantity demanded is equal to the percentage change in price. In this case, the elasticity coefficient is -1.5, so option 'B' is incorrect.

c) Highly elastic: When the elasticity coefficient is greater than -1, it indicates that the percentage change in quantity demanded is greater than the percentage change in price. In this case, the elasticity coefficient is -1.5, which is less than -1 but greater than -∞. Therefore, option 'C' is correct.

d) Perfectly inelastic: If the price elasticity of demand is zero, it means that a change in price has no effect on the quantity demanded. This is not the case here, so option 'D' is incorrect.

Conclusion:
Based on the calculation and interpretation of the elasticity coefficient, the correct option is 'C' - the demand for the commodity is highly elastic. This means that consumers are highly responsive to changes in price, resulting in a relatively large change in quantity demanded compared to the change in price.