If the Estimated Elasticity of Supply Coefficient Equals 0

question 113

Multiple Choice

If the estimated elasticity of supply coefficient equals 0.85, then:

• A)​the supply curve is vertical.
• B)​the demand curve is horizontal.
• C)​supply is unit elastic.
• D)​supply is relatively inelastic.

---

Definitions:

At-The-Money

A situation in options trading where the option's strike price is equal to the market price of the underlying asset.

Call Option

A financial contract that gives the buyer the right, but not the obligation, to buy an asset at a specified price within a specific time period.

Stock Price

The current price at which a share of a company is traded on the stock market, reflecting the value the market places on the company.

Exercise Price

The predetermined price at which an option's holder can buy (for call options) or sell (for put options) the underlying asset.