If an increase in the supply of a product in the market results in a decrease in price, but no change in the quantity traded, then
A)the price elasticity of supply is zero.
B)the price elasticity of supply is infinite.
C)the price elasticity of demand is unitary.
D)the price elasticity of demand is zero.

Question

Quizplus · Accepted Answer

When the price decreases but the quantity traded remains the same, it indicates that consumers' quantity demanded does not change with price, which is characteristic of perfectly inelastic demand, hence a price elasticity of demand of zero.

If an Increase in the Supply of a Product in the Market