In The Beautiful Tree, Dr. James Tooley describes how he found, in developing country after developing country, countless private schools aimed at educating the poor's children. The schools are completely self-funded, relying on tuition to pay salaries and upkeep. Although the teachers are effective, the schools are very basic: large playgrounds and modern building construction are very rare. Based on this information, what is the elasticity of the supply of schools?
A) Elastic, because these schools only exist in the short run.
B) Elastic, because these schools are relatively easy to establish.
C) Inelastic, because these schools are located all over the world.
D) Inelastic, because these schools must negotiate with teacher unions.

Question

Quizplus · Accepted Answer

The elasticity of the supply of schools is elastic because the private schools aimed at educating the poor's children are relatively easy to establish, despite being basic in terms of infrastructure. This is evidenced by the fact that they exist in developing country after developing country and are completely self-funded through tuition. Therefore, if there is an increase in demand for schools in these areas, entrepreneurs can quickly establish new ones to meet the demand.

In the Beautiful Tree, Dr