When the demand is parallel to x axis i.e. demand of a commodity changes even when the price remains unchanged, the elasticity is at infinity. Hence the nature of the elasticity is perfectly elastic.

Demand and Elasticity

Demand refers to the quantity of a product or service that consumers are willing and able to purchase at a given price. Elasticity, on the other hand, measures the responsiveness of demand to changes in price.

Understanding Elasticity

Elasticity can be classified into several categories based on the shape of the demand curve. These categories include perfectly elastic, perfectly inelastic, elastic, inelastic, and unitary elastic.

Perfectly Elastic Demand

If the demand curve is perfectly elastic, it means that a small change in price will cause an infinite change in quantity demanded. In other words, consumers are extremely sensitive to price changes, and a slight increase in price will lead to a complete loss of demand.

In the case where demand is parallel to the x-axis, it means that the demand curve is a horizontal line. This indicates that regardless of the price, the quantity demanded remains constant. This is a unique scenario where demand is perfectly elastic.

Explanation

When demand is parallel to the x-axis, it implies that the quantity demanded remains the same regardless of the price. In this case, consumers are not responsive to changes in price, and a change in price will not impact the quantity demanded.

For example, let's consider a product with a perfectly elastic demand, such as a generic medication. If the price of the medication increases, consumers can easily switch to alternative medications or seek substitutes. As a result, the quantity demanded for the specific medication will drop to zero.

On the other hand, if the price decreases, consumers may not necessarily increase their demand significantly, as they may already be purchasing the maximum quantity they need. Therefore, a small decrease in price will not lead to a substantial increase in quantity demanded.

Conclusion

In summary, when demand is parallel to the x-axis, indicating a horizontal demand curve, the nature of elasticity is perfectly elastic. This means that consumers are extremely sensitive to price changes, and a small change in price can lead to a complete loss of demand.

A. elasticity