If the Price Elasticity of Supply Is Less Than 1

question 225

Multiple Choice

If the price elasticity of supply is less than 1, then supply is:

• A) price elastic.
• B) price inelastic.
• C) unit price elastic.
• D) very responsive to price changes.

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Definitions:

European Countries

Nations located on the continent of Europe, known for diverse cultures, languages, and economies.

Deadweight Loss

The decrease in economic effectiveness when a product or service fails to achieve or cannot attain its balance point.

Cheesecake

A sweet dessert consisting of one or more layers, primarily a thick layer of cream cheese and egg mixture set atop a base made from crushed cookies, crackers, or sponge cake.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, leading to market stability where there is no excess supply or demand.