WorksheetsA-Level - Price Elasticity of Supply
Total questions: 10
Worksheet time: 50mins
The price elasticity of supply is:
A. the change in supply given a change in price.
B. how the price changes given a change in quantity supplied.
C. the change in quantity supplied given a change in price.
D. the percentage change in quantity supplied given a percentage change in price.
The price of a product falls from $5 to $4.
As a result, its supply in a given time period falls from 800 units to 700 units.
What is the PES?
A. 0.71
B. 0.625
C. 1.6
D. 0.5
A firm supplies 10 units of a product at $48 per unit.
If the PES is 4, how many units will the firm supply at a price of $60 per unit?
A. 10
B. 20
C. 40
D. 60
Which of these estimates of PES is most likely to apply to the supply of raw coffee beans?
A. 0.1
B. 1
C. 1.1
D. 10
The short-run supply of fresh flowers for export from Kenya
to the UK is less price elastic than the supply of green beans.
Why is this?
A. The price of cut flowers fluctuates more than the price of green beans.
B. Fresh flowers are purchased for special occasions.
C. Fresh flowers only last a few days.
D. Fresh flowers cannot be stored for as long as green beans.
Which of these products is most likely to have a perfectly elastic PES?
A. seats to watch athletics finals at the Olympic Games
B. an original painting by the famous French artist Monet
C. music downloads to an electronic device
D. a limited edition Hublot wristwatch
In very hot weather, an ice cream manufacturer decides to increase the price of its product by 10%.
It is able to increase production by 6% one week after the price increase was announced.
How can the PES be described?
A. elastic
B. inelastic
C. perfectly elastic
D. perfectly inelastic
What is the key characteristic of a product with a perfectly inelastic price elasticity of supply (PES)?
A. Producers can easily adjust production quantities
B. The PES value is equal to 1
C. Consumers are highly responsive to price changes
D. Quantity supplied remains constant regardless of price changes
A technological innovation leads to a significant increase in the production capacity of a product with elastic supply. How might this impact the stakeholders involved?
A. Producers' revenue will decrease
B. Consumers will benefit from lower prices
C. Producers will reduce their production
D. Consumers' demand will become less elastic
A product has a price elasticity of supply (PES) of 0.2.
How might this impact producers during a sudden surge in demand?
A. producers will increase output a little
B. producers will gain substantial revenue
C. producers will find it difficult to increase production
D. producers will lower production to maintain scarcity
