An increase in demand caused no change in the equilibrium price. Thus, supply must be
A) perfectly inelastic.
B) inelastic.
C) elastic.
D) perfectly elastic.

Question

Quizplus · Accepted Answer

When supply is perfectly elastic, it means that suppliers are willing to supply any quantity at a particular price. Therefore, if demand increases and the equilibrium price does not change, it indicates that the supply curve is perfectly elastic, allowing the quantity supplied to increase to meet the higher demand without changing the price.

An Increase in Demand Caused No Change in the Equilibrium