Multiple choice

A horizontal supply curve parallel to the quantity axis implies that the elasticity of supply is

  1. zero

  2. infinity

  3. equal to one

  4. greater than zero but less than one
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A horizontal supply curve indicates that producers are willing to supply any quantity at a given price, which means supply is perfectly elastic (elasticity approaches infinity). Option A (zero) would describe a vertical supply curve. Option C (unitary) and D (inelastic range) are incorrect for a horizontal curve.

Keep practicing — related questions