Ceteris paribus, if an 8 percent increase in price leads to a 6 percent increase in the quantity supplied, how would supply be described?
A) The supply curve is perfectly vertical.
B) Supply is inelastic.
C) Supply is elastic.
D) Supply is unit elastic.

Question

Quizplus · Accepted Answer

An 8 percent increase in price leads to a 6 percent increase in quantity supplied, meaning that the percentage change in quantity supplied is less than the percentage change in price. This indicates that supply is inelastic.

Ceteris Paribus, If an 8 Percent Increase in Price Leads