In May 2013, firm was supplying 500kg of sugar at market price of Rs.30/- per kg. During June 2013, firm’s supply of sugar had decreased to 450kg at price of Rs.20/- per kg. These changes show that supply of sugar is

Oerfectly elastic
Perfectly inelastic
Less elastic
More elastic

The correct answer is: D. More elastic.

The supply of sugar is more elastic because a 10% decrease in price (from Rs.30/- to Rs.20/-) led to a 10% decrease in quantity supplied (from 500kg to 450kg). This means that the quantity supplied of sugar is responsive to changes in price.

A perfectly elastic supply curve is a horizontal line, which means that the quantity supplied will change infinitely in response to a change in price. A perfectly inelastic supply curve is a vertical line, which means that the quantity supplied will not change at all in response to a change in price. A less elastic supply curve is a curve that is steeper than a perfectly elastic supply curve but less steep than a perfectly inelastic supply curve.

In this case, the supply of sugar is more elastic than a perfectly inelastic supply curve but less elastic than a perfectly elastic supply curve. This is because the quantity supplied of sugar changed in response to a change in price.