Explanation:

- When the demand curve is parallel to the X-axis, it means quantity demanded changes, but price stays the same.

- This situation describes perfectly elastic demand.

- Price elasticity of demand measures how much quantity demanded changes in response to a change in price.

Let’s look at your options:

- Option 1: Unity – This means elasticity = 1, i.e., percentage change in quantity = percentage change in price. This happens when demand curve is a rectangular hyperbola, not parallel to X-axis.

- Option 2: Zero – Elasticity is zero when the demand curve is vertical (parallel to Y-axis), so quantity demanded doesn’t change no matter the price.

- Option 3: Greater than unity – This means elastic demand, but not perfect elasticity.

- Option 4: Infinity – This means perfectly elastic demand, where any tiny change in price results in an infinite change in quantity demanded. This is shown by a horizontal (X-axis parallel) demand curve.

Correct Answer: Option 4 - Infinity