In the mid-1980s,the salaries of accounting professors with Ph.D.s increased dramatically.This resulted in an increase in enrollments in Ph.D.accounting programs.Since a Ph.D.degree in accounting may take at least four years to complete,the short-run elasticity of supply of accounting professors is
A) greater than the long-run-elasticity of supply.
B) less than the long-run elasticity of supply.
C) equal to the long-run elasticity of supply.
D) equal to the short-run elasticity of demand.

Question

Quizplus · Accepted Answer

The short-run elasticity of supply of accounting professors refers to the immediate increase in supply as a response to the sudden spike in salaries, which may take some time for individuals to pursue a Ph.D. degree. Hence, the short-run elasticity of supply is expected to be relatively low. However, in the long run, individuals may recognize the potential benefits of obtaining a Ph.D. in accounting, and the supply may become more elastic. Therefore, the long-run elasticity of supply is expected to be greater than the short-run elasticity of supply.

In the Mid-1980s,the Salaries of Accounting Professors with Ph