Tag: supply - law of supply and price elasticity of supply

Questions Related to supply - law of supply and price elasticity of supply

The vertical supply curve represents ___________ elasticity.

  1. infinite

  2. zero

  3. less

  4. one


Correct Option: A

Elasticity of supply measures ______.

  1. variability of change in supply

  2. reliability of supply

  3. rate at which quantity offered for sale change with change in price

  4. all of the above


Correct Option: C

Elasticity of supply is defined as ________.

  1. % change in supply/% change in price

  2. %change in price/% change in supply

  3. change in supply/change in price

  4. change in supply/% change in price


Correct Option: A

In the short run the supply is ________.

  1. relatively less elastic

  2. more elastic

  3. inelastic

  4. perfectly elastic


Correct Option: A

If a dealer is prepared to supply 1000 sets of a 29" Colour TV if the price is Rs. 12,000 per set, however if at price Rs. 15,000 the dealer is prepared to supply only 1100 TV sets, the elasticity of supply is _________.

  1. 1

  2. 2

  3. 0.4

  4. 1.5


Correct Option: C

A perfectly inelastic supply curve will be _________.

  1. parallel to Y axis or a vertical line

  2. parallel to X axis

  3. U shaped

  4. downward sloping


Correct Option: A

If the time horizon is longer, the elasticity of supply will be _______.

  1. unity

  2. less than unity

  3. more elastic

  4. less than 0


Correct Option: C

Elasticity of supply depends upon ________.

  1. nature of the commodity

  2. production technology

  3. future outlook of prices

  4. all of the above


Correct Option: D

If a dealer is prepared to supply 1000 sets of a 29" Colour TV if the price is Rs. 12,000 per set, however if at Rs. 15,000, the dealer is prepared to supply on 1250 sets of TV the elasticity of supply is ________.

  1. 1

  2. 2

  3. 0.75

  4. 1.4


Correct Option: A

In the long run the supply curve is ________.

  1. inelastic

  2. unity

  3. more elastic

  4. perfectly elastic


Correct Option: C