If demand curve is a rectangular hyperbola, What is the price elasticity of demand? Draw a diagram showing elasticity of demand equal to infinity.

If demand curve acquires the shape of rectangular hyperbola, the percentage alteration in price along this curve will always lead to equivalent percentage alteration in amount. Hence, the price elasticity of demand with a rectangular hyperbolic demand curve is one at every point of the curve.

Following is the diagram exhibiting infinite elasticity of demand at every point along horizontal demand curve: