Tag: economics

When the cross price elasticity of demand is zero, a change in the price of one good has no effect on the quantity demanded of the other. This indicates that the goods are unrelated or independent.

Rent on land will be produced only when different types of lands are differently fertile. At the same time, the supply of land should be elastic and not perfectly elastic.

A perfectly inelastic supply curve is a vertical line at a given quantity, which shows a constant supply regardless of price. Land becomes one such factor of production.

The horizontal demand curve parallel to X-axis implies that the elasticity of demand is infinite.

The five degrees of elasticity of supply are: perfectly inelastic, relatively inelastic, unitary elastic, relatively elastic, and perfectly elastic.

When with a minute change or without any change in price, supply may change to any extent, then the supply is Perfectly elastic

This is because if the goods are less perishable, the demand will be lower and hence supplier has lesser power to deviate price. 

Anything that affects the price of a product will affect the price elasticity of supply. Here all factors affect the supply hence option D is correct.

This specific definition is attributed to Prof. Bilas in standard economic textbooks regarding the theory of supply.

Elasticity of supply is influenced by various factors including the nature of inputs, natural constraints, production technology, and the nature of the commodity itself.