DECA Business Administration Core Practice Exam

Unitary demand is a concept in economics that applies when the percentage change in quantity demanded is equal to the percentage change in price, resulting in a constant total revenue. In other words, if sales remain constant despite changes in supply and demand, it indicates that the product's price elasticity is unitary, meaning that any increase in price will lead to a proportional decrease in quantity demanded, and vice versa.

This situation can often characterize a market in balance where the effects of supply and demand changes counterbalance, keeping sales stable rather than leading to fluctuations in revenue. It's essential to understand that unitary demand signifies a very specific relationship between price changes and sales, indicating that consumers are responding predictably to price fluctuations, thereby maintaining consistent sales levels.

Other terms like elastic or inelastic demand refer to situations where changes in price lead to relatively higher or lower percentages in quantity demanded, respectively. Equilibrium demand relates more broadly to the condition in a market where supply equals demand, but it doesn't specifically capture the concept of sales remaining constant as prices change.