For a given shift in demand, the less elastic is supply, the
A)greater is the shift in demand.
B)greater is the change in equilibrium quantity.
C)smaller is the shift in demand.
D)greater is the change in price.
E)smaller is the change in price.

Question

Quizplus · Accepted Answer

When supply is less elastic, it means that the quantity supplied cannot adjust easily to changes in price. Therefore, a shift in demand will result in a more significant change in price as the market tries to find a new equilibrium point. Therefore, the greater is the change in price.

For a Given Shift in Demand, the Less Elastic Is