Question

    A a Correct Answer Incorrect Answer
    B b Correct Answer Incorrect Answer
    C c Correct Answer Incorrect Answer
    D d Correct Answer Incorrect Answer

    Solution

    In a model with two goods, x and y, where x is plotted on the horizontal axis, a price consumption curve (PCC) that is parallel to the x-axis implies that the quantity demanded of good x does not change as its price changes. This means that the demand for x is perfectly inelastic.

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