referring to the graph above, compare the four supply curves in terms of their price elasticity at price p1…

referring to the graph above, compare the four supply curves in terms of their price elasticity at price p1: 1. supply curve s1 is best described as perfectly elastic 2. supply curve s2 is best described as select 3. supply curve s3 is best described as select 4. supply curve s4 is best described as perfectly elastic more elastic than s3 less elastic than s4 perfectly inelastic

referring to the graph above, compare the four supply curves in terms of their price elasticity at price p1: 1. supply curve s1 is best described as perfectly elastic 2. supply curve s2 is best described as select 3. supply curve s3 is best described as select 4. supply curve s4 is best described as perfectly elastic more elastic than s3 less elastic than s4 perfectly inelastic

Answer

Explanation:

Step1: Recall price - elasticity of supply concept

The price - elasticity of supply measures the responsiveness of the quantity supplied to a change in price. A vertical supply curve is perfectly inelastic, a horizontal supply curve is perfectly elastic, and flatter curves are more elastic than steeper ones.

Step2: Analyze S1

Supply curve S1 is vertical. At price P1, a change in price will not change the quantity supplied. So, it is perfectly inelastic.

Step3: Analyze S2

Supply curve S2 is upward - sloping and steeper compared to S3. A steeper upward - sloping supply curve is less elastic. It is inelastic.

Step4: Analyze S3

Supply curve S3 is upward - sloping and flatter than S2. A flatter upward - sloping supply curve is more elastic than a steeper one. So, S3 is more elastic than S2.

Step5: Analyze S4

Supply curve S4 is horizontal. At price P1, the quantity supplied can be infinitely varied without any change in price. So, it is perfectly elastic.

Answer:

  1. perfectly inelastic
  2. inelastic
  3. more elastic than S2
  4. perfectly elastic