FIGURE 5-4
-Refer to Figure 5-4. What is the significance of the difference in the slopes of the short-run supply curve S1) and the long-run supply curve S2) for apartments?
A) Over time, the supply of apartments shrinks in response to the controlled prices - the elasticity of supply decreases.
B) Over time, the demand for apartments shrinks in response to the controlled prices - the elasticity of supply increases.
C) Over time, the demand for apartments increases in response to the controlled prices - the elasticity of supply increases.
D) Over time, the supply of apartments increases in response to the controlled prices - the elasticity of demand increases.
E) Over time, the supply of apartments shrinks in response to the controlled prices - the elasticity of supply increases.

Question

FIGURE 5-4
-Refer to Figure 5-4. What is the significance of the difference in the slopes of the short-run supply curve S1) and the long-run supply curve S2) for apartments?
A) Over time, the supply of apartments shrinks in response to the controlled prices - the elasticity of supply decreases. 
B) Over time, the demand for apartments shrinks in response to the controlled prices - the elasticity of supply increases. 
C) Over time, the demand for apartments increases in response to the controlled prices - the elasticity of supply increases. 
D) Over time, the supply of apartments increases in response to the controlled prices - the elasticity of demand increases. 
E) Over time, the supply of apartments shrinks in response to the controlled prices - the elasticity of supply increases.

Quizplus · Accepted Answer

Over time, the supply of apartments becomes more elastic as landlords can adjust to controlled prices, leading to an increase in the elasticity of supply.

FIGURE 5-4 -Refer to Figure 5-4. What Is the Significance of the of the Difference