Why is the supply of oil more price elastic in the long run?
A) New deposits are found.
B) Better extraction technology is developed.
C) Firms have the ability to change the amount of all inputs.
D) All of the above.

Question

Quizplus · Accepted Answer

All of the above choices, A, B, and C, contribute to making the supply of oil more price elastic in the long run. The discovery of new deposits and the development of better extraction technology increase the availability of oil, making it easier to produce and supply in response to changes in price. Furthermore, firms have the ability to adjust their mix of inputs and the technology they use for extracting oil in the long run, which also contributes to making the supply of oil more price elastic.

Why Is the Supply of Oil More Price Elastic in the Long