A value of zero for the elasticity of supply of some product implies that
A) the supply curve is horizontal.
B) the product will not be supplied at any price.
C) there is no supply.
D) supply is highly responsive to price.
E) the supply curve is vertical.

Question

Quizplus · Accepted Answer

A zero elasticity of supply means that the quantity supplied does not change in response to changes in price. This implies that the supply curve is vertical, or perfectly inelastic. This could happen for goods with fixed production capabilities or limited resources, where production cannot be increased regardless of price changes.

A Value of Zero for the Elasticity of Supply of Some