{"id":47979,"date":"2024-04-15T22:34:37","date_gmt":"2024-04-15T22:34:37","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=47979"},"modified":"2024-04-15T22:34:37","modified_gmt":"2024-04-15T22:34:37","slug":"elasticity-of-supply-refers-to-the-degree-of-responsiveness-of-supply-of-a-commodity-to-changes-in-its","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/elasticity-of-supply-refers-to-the-degree-of-responsiveness-of-supply-of-a-commodity-to-changes-in-its\/","title":{"rendered":"Elasticity of supply refers to the degree of responsiveness of supply of a commodity to changes in its"},"content":{"rendered":"

[amp_mcq option1=”Demand” option2=”Price” option3=”Cost of production” option4=”State of technology” correct=”option2″]<\/p>\n

The correct answer is B. Price.<\/p>\n

Elasticity of supply is a measure of how much the quantity supplied of a good or service changes in response to a change in its price. It is calculated as the percentage change in quantity supplied divided by the percentage change in price.<\/p>\n

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.<\/p>\n

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.<\/p>\n

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.<\/p>\n

Here is a brief explanation of each option:<\/p>\n