This topic contains a solution. Click here to go to the answer

Author Question: Differentiate between perfectly elastic supply and perfectly inelastic supply. When the price of a ... (Read 143 times)

ss2343

  • Hero Member
  • *****
  • Posts: 548
Differentiate between perfectly elastic supply and perfectly inelastic supply. When the price of a good is 100, 50 units are supplied. When the price increases to 300, 250 units are supplied. Calculate the price elasticity of supply of the good.
 
  What will be an ideal response?

Question 2

________ is a market structure where only one firm provides a good or service that has no close substitutes.
 
  A) Oligopoly
  B) Monopoly
  C) Perfect competition
  D) Monopolistic competition



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Jayson

  • Sr. Member
  • ****
  • Posts: 350
Answer to Question 1

A good is said to have a perfectly elastic supply when a very small change in the good's price leads to an infinite change in the good's quantity supplied. The price elasticity of supply of such goods equals infinity. On the other hand, a good is said to have a perfectly inelastic supply when the quantity supplied of a good does not change with changes in its price, in which case the price elasticity of supply equals zero.

Percentage change in price of the good when price increases from 100 to 300 = 200
Percentage change in quantity supplied of the good from 50 units to 250 units = 400
Hence price elasticity of supply of the good = 400/200 = 2.

Answer to Question 2

B




ss2343

  • Member
  • Posts: 548
Reply 2 on: Jun 29, 2018
Thanks for the timely response, appreciate it


deja

  • Member
  • Posts: 332
Reply 3 on: Yesterday
:D TYSM

 

Did you know?

In the United States, congenital cytomegalovirus causes one child to become disabled almost every hour. CMV is the leading preventable viral cause of development disability in newborns. These disabilities include hearing or vision loss, and cerebral palsy.

Did you know?

Pope Sylvester II tried to introduce Arabic numbers into Europe between the years 999 and 1003, but their use did not catch on for a few more centuries, and Roman numerals continued to be the primary number system.

Did you know?

Immunoglobulin injections may give short-term protection against, or reduce severity of certain diseases. They help people who have an inherited problem making their own antibodies, or those who are having certain types of cancer treatments.

Did you know?

Blood in the urine can be a sign of a kidney stone, glomerulonephritis, or other kidney problems.

Did you know?

When taking monoamine oxidase inhibitors, people should avoid a variety of foods, which include alcoholic beverages, bean curd, broad (fava) bean pods, cheese, fish, ginseng, protein extracts, meat, sauerkraut, shrimp paste, soups, and yeast.

For a complete list of videos, visit our video library