A key determinant of the price elasticity of supply is the
A) how responsive buyers are to changes in sellers’ prices.
B) the slope of the demand curve.
C) the ability of sellers to change the amount of the good they produce.
D) the ability of sellers to change the price of the good they produce.
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The Correct Answer for the given question is Option C) the ability of sellers to change the amount of the good they produce.
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Price Elasticity of Supply FAQs
What is the formula for measuring the price elasticity of supply?
Answer:
Price elasticity of supply = % change in quantity supplied / % change in price.
The price elasticity of supply measures how
Answer: how much quantity supplied changes in response to a change in the price.
What are the determinants of the price elasticity of supply?
Answer: The determinants of elasticity of supply are as follows:
- Number of producers.
- Spare capacity.
- Effortlessness of switching.
- Ease of storage.
- Length of the period of production.
- The time frame of training.
- Mobility of factors.
- Reaction of costs.
The law of supply suggests that the price elasticity of supply is
a) Always less than 1
b) Positive
c) Always greater than 1
d) Negative
Answer: b) Positive
The price elasticity of supply for a product will be 2 if a
a) 1 percent decrease in price causes a 2 percent decrease in quantity supplied
b) 1 percent decrease in the price causes a 0.2 percent decrease in quantity supplied
c) 2 percent decrease in price causes a 1 percent decrease in quantity supplied
d) 2 percent decrease in price causes a 2 percent decrease in quantity supplied
Answer: a) 1 percent decrease in price causes a 2 percent decrease in quantity supplied.
The price elasticity of supply when supply is perfectly inelastic is
Answer: PES = 0 ( There is no change in quantity if prices change.)
Match the price elasticity of supply to the product it describes.
The price elasticity of supply along a typical supply curve is
In the figure, which determinants of the price elasticity of supply do s1, s2, and s3 depict?
Suppose the value of the price elasticity of supply is 4. what does this mean?
As the price elasticity of supply approaches infinity, very small changes in price lead to
As price elasticity of supply increases, the supply curve
If the price elasticity of supply is 0.8, and price increased by 5%, quantity supplied would
All things equal, the price elasticity of supply
Price elasticity of supply can be found by
The elasticity of supply of product x is unitary if the price of x rises by
If the price elasticity of supply for wheat is less than 1, then the supply of wheat is
If the price elasticity of supply is 1.2, and price increased by 5%, quantity supplied would
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I am Smirti Bam, an enthusiastic edu blogger with a passion for sharing insights into the dynamic world of business and management through this website.
I hold a MBA degree from Presidential Business School, Kathmandu, and a BBA degree with a specialization in Finance from Apex College,
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