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Question
The following image shows:
Options
Relatively Elastic Supply
Relatively Inelastic Supply
Perfect Inelastic Supply
Unity Elastic Supply
MCQ
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Solution
Relatively Elastic Supply
Explanation:
According to the geometric method for measuring the price elasticity of supply (Es), a linear supply curve that intersects the vertical Y-axis (price axis) above the origin indicates a relatively elastic supply (Es > 1). This indicates that the percentage change in the amount provided of the commodity exceeds the percentage change in its market price.
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