Which elasticity measures producers' responsiveness to a change in price?
A)Price elasticity of supply
B)Price elasticity of demand
C)Cross-price elasticity
D)Income elasticity of supply

Question

Quizplus · Accepted Answer

Price elasticity of supply measures the percentage change in the quantity supplied of a good in response to a percentage change in price. Therefore, it directly measures producers' responsiveness to a change in price. Choice B) Price elasticity of demand measures the consumers' responsiveness to a change in price, while choices C) and D) measure how the quantity demanded or supplied of one good responds to a change in the price of another good or a change in income, respectively.

Which Elasticity Measures Producers' Responsiveness to a Change in Price