Arnie recently purchased the Mill Town Square Mall in Philadelphia. Attempting to explain the elasticity of supply to shop owners in the mall, he tells them that the price elasticity of supply measures:
A)the responsiveness of supply to changes in technology.
B)the responsiveness of supply to changes in input prices.
C)the responsiveness of quantity supplied to changes in price.
D)the response of supply to changes in technology and changes in price.

Question

Quizplus · Accepted Answer

The price elasticity of supply measures the degree of responsiveness of quantity supplied to changes in price. It is a measure of how much the quantity supplied of a good or service changes in response to a change in its price. It helps businesses understand how much they should increase or decrease their supply of a product as its price changes in the market.

Arnie Recently Purchased the Mill Town Square Mall in Philadelphia