What is a characteristic of an elastic demand curve?

An elastic demand curve is characterized by a situation where the percentage change in price leads to a larger percentage change in quantity demanded. This means that consumers are relatively sensitive to price changes; when the price decreases, the quantity demanded increases significantly, and when the price increases, the quantity demanded decreases significantly.

The sensitivity reflected in an elastic demand curve indicates that goods or services with elastic demand typically have readily available substitutes, or they may be considered non-essential by consumers. As a result, small changes in price can significantly affect consumers’ willingness to purchase. This responsiveness is crucial in understanding market behavior and setting pricing strategies.

In contrast, the other options describe characteristics associated with inelastic demand or perfectly inelastic demand, which demonstrate that the quantity demanded does not change much or at all when prices fluctuate.