SOLVED

5.2Â Â The Price Elasticity of Supply 1) What is measured by the price elasticity of supply? A) The price elasticity of supply measures how responsive producers are to changes in the price of other goods. B) The price elasticity of supply measures how responsive producers are to changes in income. C) The price elasticity of supply measures how responsive producers are to changes in the price of a product. D) The price elasticity of supply is a measure of the slope of the supply curve. E) The price elasticity of supply measures how responsive producers are to changes in the cost of producing a product. 2) The price elasticity of supply measures A) the percentage change in supply from a percentage change in demand. B) the extent to which the quantity supplied of a good changes when the price of a good changes, other things remaining the same. C) the slope of the supply curve. D) how the equilibrium price changes in response to a change in the equilibrium quantity supplied. E) Both answers B and C are correct. 3) The price elasticity of supply is always a positive value because i.there is a direct relationship between the price and the quantity supplied. ii.as the equilibrium price increases, the equilibrium quantity also always increases. iii.buyers are willing to pay a higher price for larger quantities. A) i only B) ii only C) iii only D) i and ii E) ii and iii 4) If the percentage change in the price of a good exceeds the percentage change in the quantity supplied, then the supply is A) elastic. B) inelastic. C) unit elastic. D) perfectly elastic. E) perfectly inelastic. 5) When the percentage change in the quantity supplied equals the percentage change in price, the supply is A) elastic. B) inelastic. C) unit elastic. D) perfectly elastic. E) perfectly inelastic. 6) When the percentage change in the quantity supplied is less than the percentage change in price, the supply is A) elastic. B) inelastic. C) unit elastic. D) perfectly unit elastic. E) perfectly elastic. 7) The figure above shows the supply curve for a good with A) a perfectly elastic supply. B) a perfectly inelastic supply. C) an elastic supply. D) an inelastic supply. E) a unit elastic supply. 8) If a small percentage change in the price brings a very large percentage change in the quantity supplied, then the supply is almost perfectly ________ and the supply curve is almost ________. A) elastic; vertical B) elastic; horizontal C) inelastic; horizontal D) inelastic ; vertical E) elastic; 45 degrees 9) The figure above shows the supply curve for a good with a A) perfectly elastic supply. B) perfectly inelastic supply. C) elastic supply. D) inelastic supply. E) unit elastic supply. 10) If the supply curve is ________, the elasticity of supply is ________. A) vertical; infinite B) vertical; 0 C) horizontal; 1 D) horizontal; 0 E) a straight, upward sloping line through the origin; 0