Advertisements
Advertisements
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
Advertisements
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.
APPEARS IN
RELATED QUESTIONS
Explain briefly the impact of the cost of production on the elasticity of supply.
What is the formula for percentage method of calculating price elasticity of supply?
Identify the elasticity of supply for the following with proper reasoning:
Short run and long run period.
Which of the following measures of price elasticity shows elasticity shows elastic supply?
When an entrepreneur introduces a new technique or a new product, it is called ______.
Identify the correct sequence of alternatives given in Column II by matching them with respective terms in Column:
| 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:
Assertion (A): In case of perfectly inelastic supply, supply curve is a vertical straight line supply curve.
Reason (R): Supply does not change with change in price in case of Es = 0.
Draw a straight line supply showing elasticity greater than one.
Price of a product increases by 2%. As a result, its supply rises by 4%. What is elasticity of supply of the commodity?
Draw and briefly explain a perfectly elastic supply curve.
Give the meaning of perfectly elastic supply.
Define price elasticity of supply.
Draw the supply curve showing price elasticity of supply greater than one.
Indicate the degree of elasticity on the supply curve given below:
If the price of a commodity falls by 10% and consequently, the quantity supplied decreases by 20%, what will be its elasticity of supply?
What do you mean by perfectly inelastic supply?
Price elasticity of supply of a good is 0.8. Is the supply 'elastic' or 'inelastic', and why?
Explain the percentage method of measuring price elasticity of supply.
Draw a straight line supply curve of the following situation.
More than unitary elastic
