What is measured by the price elasticity of supply?
A) The price elasticity of supply measures how responsive producers are to changes in the price of other goods.
B) The price elasticity of supply measures how responsive producers are to changes in income.
C) The price elasticity of supply measures how responsive producers are to changes in the price of a product.
D) The price elasticity of supply is a measure of the slope of the supply curve.
E) The price elasticity of supply measures how responsive producers are to changes in the cost of producing a product.

Question

Quizplus · Accepted Answer

The price elasticity of supply measures how responsive producers are to changes in the price of a product. It quantifies the percentage change in quantity supplied in response to a one percent change in the price of the product. A higher price elasticity of supply indicates a greater responsiveness of producers to changes in price, implying that they can increase or decrease the quantity supplied more easily in response to changes in market conditions.

What Is Measured by the Price Elasticity of Supply