Elasticity of supply refers to the degree of responsiveness of supply of a commodity to changes in its

The correct answer is B. Price.

Elasticity of supply is a measure of how much the quantity supplied of a good

A good with elastic supply is one in which the quantity supplied changes by a large percentage in response to a small percentage change in price. A good with inelastic supply is one in which the quantity supplied changes by a small percentage in response to a large percentage change in price.

The price of a good is one of the most important factors that affects the quantity supplied of that good. When the price of a good increases, producers are willing to supply more of that good, and when the price of a good decreases, producers are willing to supply less of that good.

The other factors that can affect the quantity supplied of a good include the cost of production, the state of technology, and the prices of other goods. However, the price of a good is usually the most important factor that affects the quantity supplied.

Here is a brief explanation of each option:

• Option A: Demand. Demand is the willingness and ability of buyers to purchase a good or service. It is not a factor that affects the quantity supplied of a good.
• Option B: Price. Price is the amount of money that buyers are willing and able to pay for a good or service. It is the most important factor that affects the quantity supplied of a good.
• Option C: Cost of production. The cost of production is the amount of money that producers spend to produce a good or service. It is a factor that affects the quantity supplied
  Join Our Telegram Channel
  of a good, but it is not as important as the price of the good.
• Option D: State of technology. The state of technology is the level of knowledge and skills that producers have about how to produce goods and services. It is a factor that affects the quantity supplied of a good, but it is not as important as the price of the good.