Which of the Following Statements Applies to a Perfectly Elastic

question 83

Multiple Choice

Which of the following statements applies to a perfectly elastic supply curve

• A)The elasticity of supply is 1.
• B)The supply curve is vertical.
• C)Very small changes in price lead to large changes in quantity supplied.
• D)The firm would likely be operating in the short run.

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Definitions:

Consumer Surplus

The gap between what consumers are prepared and able to spend on a product or service and the actual sum they end up paying.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase at various prices.

Total Utility

The total satisfaction or benefit a person receives from consuming a particular quantity of goods or services.

Consumer Surplus

The difference between the maximum price a consumer is willing to pay for a good or service and the actual price they pay.