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The elasticity at a point on a straight line supply curve passing through the origin will be
- a)3
- b)1.0
- c)4
- d)2
Correct answer is option 'B'. Can you explain this answer?
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Verified Answer
The elasticity at a point on a straight line supply curve passing thro...
Regardless of the gradient of the linear supply curve or its position on the supply curve, the PES of a linear supply curve that passes through the origin is always equal to 1. Therefore, if the supply curve originates with P=0 and Q=0, the elasticity will always be 1.
Formula-
%Change in quantity
%change in price.
Formula-
%Change in quantity
%change in price.
Most Upvoted Answer
The elasticity at a point on a straight line supply curve passing thro...
Explanation:
Elasticity of supply is the measure of the responsiveness of the quantity supplied of a good or service to a change in its price. It is calculated as the percentage change in quantity supplied divided by the percentage change in price.
Formula for elasticity of supply = (% change in quantity supplied) / (% change in price)
In the case of a straight line supply curve passing through the origin, the slope of the line is constant. This implies that the percentage change in quantity supplied is always equal to the percentage change in price. Hence, the elasticity of supply will always be 1.0.
Therefore, the correct answer is option B.
Elasticity of supply is the measure of the responsiveness of the quantity supplied of a good or service to a change in its price. It is calculated as the percentage change in quantity supplied divided by the percentage change in price.
Formula for elasticity of supply = (% change in quantity supplied) / (% change in price)
In the case of a straight line supply curve passing through the origin, the slope of the line is constant. This implies that the percentage change in quantity supplied is always equal to the percentage change in price. Hence, the elasticity of supply will always be 1.0.
Therefore, the correct answer is option B.
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Community Answer
The elasticity at a point on a straight line supply curve passing thro...
Regardless of the gradient of the linear supply curve or its position on the supply curve, the PES of a linear supply curve that passes through the origin is always equal to 1. Therefore, if the supply curve originates with P = 0 and Q = 0, the elasticity will always be 1.
Formula:
%Change in quantity / %change in price.
Formula:
%Change in quantity / %change in price.
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The elasticity at a point on a straight line supply curve passing through the origin will bea)3b)1.0c)4d)2Correct answer is option 'B'. Can you explain this answer?
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