QUIZ 3.3, 3.4

The price of a dozen eggs rises from $3 to $4.70. In response to this price change, quantity supplied increases from 100,000 dozen eggs to 127,000 dozen eggs. What is the approximate price elasticity of supply for eggs?

0.48

If quantity supplied does not respond substantially to a relatively large change in price, supply is:

INELASTIC

What is quantity supplied?

It is the amount of an item that a seller is willing to sell at a particular price.

(Figure: Supply Curves) The figure shows four different supply curves for four products. Which of the products has a perfectly inelastic supply curve?

PRODUCT A (VERTICAL LINE)

(Figure: Supply Curves) The figure shows four different supply curves for four products. Which of the products has an inelastic, but not perfectly inelastic supply curve?

PRODUCT B INELASTIC- VERTICAL ELASTIC - HORIZONTAL

Solved Figure: Supply Curves) The figure shows four | Chegg.com

PRODUCT B (Looks like a stepper positive line)

(Figure: Supply Curves) The figure shows four different supply curves for four products. Which of the products has an elastic, but not perfectly elastic, supply curve?

Product D Supply is almost horizontal INELASTIC- VERTICAL ELASTIC - HORIZONTAL

Which factor would result in a decrease in the supply of linen shirts?

a poor harvest of flax plant, the key ingredient in linen fabric, used to manufacture linen shirts

Which factor would cause a DECREASE in the supply of peanut butter?

a rise in the price of peanuts

Complement in production

allow a business to produce goods together.

Which event would shift the supply curve for Ben and Jerry's ice cream to the left?

an increase in the price of cream, an ingredient in ice cream

You run a successful designer clothing boutique but expect that demand for your products will decline in the next six months as the economy falls into recession. As a result, the opportunity cost of supplying designer clothing today will:

fall, causing your supply curve to shift to the right.

Supply curves tend to be _____ the more time producers have to adjust to price changes.

flatter (HORIZONTAL)

(Figure: Graph 2) In the graph, the movement from point L to point K is caused by a(n): increase in the price of the item. decrease in the price of the item. decrease in the supply of the item. increase in the supply of the item.

increase in the price of the item

Over the past few years, the technology associated with producing flat-panel televisions has improved. This has led to ________ in ________ flat-panel televisions.

increase; supply of

Which example best represents perfectly inelastic supply?

original paintings made by Leonardo Da Vinci

(Figure: Graph 2) In the graph, a decrease in the price of the item will cause the movement from:

point H to point G.

If baseball bats and toothpicks are substitutes in production, a producer (with her fixed set of resources) will need to reduce the production of baseball bats when she:

produces more of the other good.

If a firm produces a product that has easily available variable inputs, its supply curve will be:

relatively flat

Price elasticity of supply measures how responsive: sellers are to changes in the prices of competing goods. sellers are to price changes. buyers are to price changes. sellers are to changes in cost of production.

sellers are to price changes.