Ask Question
BusinessBusiness
21 May, 19:27

If supply is quite elastic, an increase in demand for output will:

a) increase equilibrium price substantially and increase equilibrium output substantially.

b) increase the equilibrium price substantially and increase equilibrium output slightly.

c) increase equilibrium price slightly and increase equilibrium output substantially.

d) increase the equilibrium price slightly and increase equilibrium output slightly.

e) not affect equilibrium price and output.

+3
Answers (1)
  1. 21 May, 19:32
    0
    Option (c) is correct.

    Explanation:

    If the supply of a product is quite elastic or we can say that it is relatively flatter than the demand curve. So, if there is an increase in the demand for the output then as a result there is a rightward shift in the demand curve.

    This shift in the demand curve will increase the equilibrium price and equilibrium output in an economy. As we know that the supply curve is flatter than the demand curve, hence, an increase in equilibrium output is greater than the increase in equilibrium price.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “If supply is quite elastic, an increase in demand for output will: a) increase equilibrium price substantially and increase equilibrium ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Pharmaceutical companies sell some of their products to hospitals and clinics directly. they also market other products to large retail chains like walgreens that distribute them to their stores across the nation.
Answers (1)
Why would we expect a company like intel to report a relatively high proportion of equity vis-à-vis liabilities?:?
Answers (1)
The auditors are concerned that these practices are inadequate and that more secure alternatives should be explored. Management has expressed counter concerns about the high cost of purchasing new equipment and relocating its data center.
Answers (1)
Manny owns 1/4 of the partnership, while Jose has a 1/5 of interest. What fraction of the partnership does todd own?
Answers (2)
Key considerations involved in planning and conducting multinational operations are affected by a. media influence b. financial resource constraints c. non-military organizations d. motives and values of the organization's members
Answers (1)
New Questions in Business
At the time the transaction occurred, which of the following would result in an increase in net income under the accrual basis of accounting, but would not result in an increase in net income under cash basis accounting?
Answers (1)
You've decided to buy a new computer that costs $1,500. But Best Buy will let you take the computer home without making paying the full price immediately. Rather, Best Buy will let you pay $500 now, and $500 at the end of each of the next two years.
Answers (1)
Alice's three children are driving her crazy. they are constantly squabbling, calling one another names, and generally tormenting one another. to preserve what's left of her sanity, alice has decided to try to convince the youngsters to get along.
Answers (1)
Introduction to Early Childhood The National Association for the Education of Young Children (NAEYC) statement of commitment includes all of the following obligations except A. serving as an advocate for children and their families. B.
Answers (1)
James Bright's company seeks markets all over the world and attempts to sell products that are a result of planned production for markets in various countries.
Answers (1)
Home » Business » If supply is quite elastic, an increase in demand for output will: a) increase equilibrium price substantially and increase equilibrium output substantially. b) increase the equilibrium price substantially and increase equilibrium output slightly.
Sign Up Forgot Password?