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Question
When the percentage change in the quantity supplied of a commodity is exactly equal to the percentage change in its price it is known as ______.
Options
Unitary elastic supply
Relatively inelastic supply
Relatively elastic supply
Perfectly inelastic supply
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Solution
When the percentage change in the quantity supplied of a commodity is exactly equal to the percentage change in its price it is known as Unitary elastic supply.
Explanation:
Unitary elastic supply occurs when the percentage change in the quantity supplied of a commodity is exactly equal to the percentage change in its price. This means the elasticity of supply (Es) equals 1, indicating a proportional relationship between price and quantity supplied.
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RELATED QUESTIONS
Draw a well-labelled diagram showing the price elasticity of supply of a commodity starting from the origin.
A 10 per cent increase in price of a good causes 5 per cent increase in its quantity supplied, elasticity of supply will be ______.
If price elasticity of supply is greater than 1, then supply is said be elastic.
The given diagram is a case of ______ supply.
When the price increases by 50% and the supply increases only by 5% the price elasticity of supply of that commodity will be ______.
Identify the correct sequence of alternatives given in Column II by matching them with respective terms in Column I:
| Column I | Column II |
| A. Perfectly Inelastic | (i) Es > 1 |
| B. Perfectly Elastic | (ii) Es < 1 |
| C. Inelastic | (iii) Es = 0 |
| D. Highly Elastic | (iv) Es = infinity |
Choose the correct alternative:
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| Price | Quantity supplied |
| 10 | 200 |
| 15 | 225 |
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Ep > 1
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