4. Unitary Elastic Demand rarely occurs in practice. State whether the following statements are TRUE and FALSE.

State whether the following statements are TRUE and FALSE.
4. Unitary Elastic Demand rarely occurs in practice.
Answer: 
TRUE
Unitary elasticity implies that a certain percentage increase in price is offset by equal percentage decrease in demand. If price of a good rises by two times, then the demand for the good gets halved. Similarly, a percentage decrease in price is offset by an equal percentage increase in demand for the good. Such an exact behaviour rarely occurs in practice.

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