In which case will the price change be the greatest (assuming the shifts described are the same size)?
A) Demand is inelastic, and supply shifts to the left.
B) Supply is perfectly elastic, and demand shifts to the left.
C) Demand is elastic, and supply shifts to the left.
D) Supply is elastic, and demand shifts to the left.

Question

Quizplus · Accepted Answer

When demand is inelastic, a leftward shift in supply will lead to a significant increase in price because consumers are not very responsive to price changes, so the quantity demanded doesn't decrease much.

In Which Case Will the Price Change Be the Greatest