PRC-3 · Chapter 11 · Question 42 of 57
If a 5% increase in price causes absolutely no change in the quantity supplied of a good, the elasticity of supply is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Zero (Perfectly inelastic)
Explanation
When quantity supplied does not respond at all to a price change, the elasticity coefficient is zero, denoting perfectly inelastic supply.
More Elasticity of Demand and Supply MCQs
- Q44What is the shape of a demand curve that has a strictly constant slope throughout?
- Q45If a geometric supply schedule has a price elasticity of supply exactly equal to 1 at all points, its graph will be:
- Q46The elasticity of supply for highly perishable agricultural goods (like fresh milk or ripe strawberries) on market day is generally:
- Q47Because durable manufactured goods (like televisions) can be easily stored in warehouses without spoiling while waiting for prices to…
- Q48What specific term describes the measurement of how sensitive the demand for a good is to a change in the consumers' money income?