Price Elasticity of Supply Quiz

How do you calculate price elasticity of supply?

• By adding the percentage change in quantity supplied to the percentage change in price.

• By dividing the percentage change in quantity supplied by the percentage change in price.

• By multiplying the percentage change in quantity supplied by the percentage change in price.

• By subtracting the percentage change in quantity supplied from the percentage change in price.

What factors affect price elasticity of supply?

• Production time frame, availability of resources, and flexibility of production processes

• Government regulations

• Market competition

• Consumer demand

What are some applications of price elasticity of supply?

• Predicting the effect of changes in production costs

• Measuring the demand for a product

• Analyzing the impact of advertising on sales

• Determining the impact of taxation on goods and services

What is the significance of a high price elasticity of supply?

• It indicates that the quantity supplied is highly responsive to changes in price.

• It indicates that the quantity supplied is not responsive to changes in price.

• It indicates that the price of the product is high.

• It indicates that the price of the product is low.

What happens when the price elasticity of supply is less than one?

• The supply is said to be price elastic.

• The supply is said to be price inelastic.

• The supply is said to be unitary elastic.

• The supply is said to be perfectly elastic.

How does the availability of substitutes affect the price elasticity of supply?

• Greater the availability of substitutes, more elastic is the supply.

• Greater the availability of substitutes, less elastic is the supply.

• The availability of substitutes does not affect the price elasticity of supply.

• The availability of substitutes makes the supply perfectly elastic.

What does a price elasticity of supply equal to zero indicate?

• The supply is perfectly elastic.

• The supply is perfectly inelastic.

• The supply is unitary elastic.

• The supply is relatively elastic.

How does the time period affect the price elasticity of supply?

• The longer the time period, the more elastic is the supply.

• The longer the time period, the less elastic is the supply.

• The time period does not affect the price elasticity of supply.

• The time period makes the supply perfectly elastic.

What is the impact of technological advancements on the price elasticity of supply?

• Technological advancements make the supply more elastic.

• Technological advancements make the supply less elastic.

• Technological advancements do not affect the price elasticity of supply.

• Technological advancements make the supply perfectly elastic.