In the very short-run period,
A) the price elasticity of supply is very elastic.
B) the price elasticity of demand is very elastic.
C) the cross elasticity of demand is very inelastic.
D) income elasticity is very elastic.
E) the price elasticity of supply is very inelastic.

Question

Quizplus · Accepted Answer

In the very short-run period, suppliers are not able to adjust their supply to changes in price, making the price elasticity of supply very inelastic. This is because in the very short-run, producers cannot easily change their inputs, technology or production processes. Demand, on the other hand, can fluctuate rapidly in the very short run with changes in consumer preferences or seasonal factors, making the price elasticity of demand more elastic than in the long run. Cross elasticity of demand and income elasticity are not necessarily affected by the short-run period.

In the Very Short-Run Period