Economics 9708 · AS & A Level
Price elasticity of supply
100 practice questions on Price elasticity of supply, with worked solutions and instant marking.
A 10% tax is imposed on a good. Which type of product would be most likely to experience the greatest effect on its equilibrium price as a result?
Feb/March 2016
What does price elasticity of supply mean?
Feb/March 2016
Explain two factors that are likely to make the supply of a product relatively price-inelastic.
Feb/March 2016
Which change would reduce the price elasticity of supply for a product?
Feb/March 2017
Explain the factors that are likely to cause a product's supply to be relatively price inelastic.
Feb/March 2017
The table presents three different weekly prices and quantities supplied for two products, X and Y. Which statement about price elasticity of supply (PES) is correct?
Feb/March 2018
Explain how economists assess the extent to which the supply of a good responds when its price changes. Explain two factors that affect the result.
Feb/March 2018
On which supply curve is the price elasticity of supply value not constant at every point on the curve?
Feb/March 2019
Four firms make furniture. The table gives the price elasticity of supply (PES) for each firm. If the price of furniture goes up by 5%, which firm would see quantity supplied rise by 2.5%?
Feb/March 2020
In which situation would a manufacturer be more able to increase the quantity supplied in the short run?
Feb/March 2020
What is the probable price elasticity of supply for highly perishable goods and goods with low stocks?
Feb/March 2021
A firm calculates that the price elasticity of supply for its product is +1.5. What does this show?
Feb/March 2022
Use examples to show why the supply of some products is price elastic, whereas the supply of other products is price inelastic.
Feb/March 2022
Which diagram shows unitary elasticity of supply?
Feb/March 2023
The price elasticity of the supply of yoghurt is estimated at +1.5. If demand for yoghurt increases and the price goes up by 20%, by what amount will market supply rise?
Feb/March 2024
Using a formula, explain the meaning of income elasticity of demand and assess the extent to which a rise in income will raise the consumption of all goods and services.
Feb/March 2024
Which factors will affect the value of the price elasticity of supply of a good?
Feb/March 2025
The demand for a commodity has unitary price elasticity. Which diagram illustrates how total expenditure on the commodity varies with its price?
May/June 2010
A refinery that converts oil into petrol (gas) is operating under these conditions. 1 It is operating at maximum capacity. 2 Its petrol storage tanks are already full. 3 It has been delivered a new fleet of petrol tankers to move its petrol. 4 It takes six months to train new workers so that they are qualified in safety procedures. Which of these conditions would be likely to make the supply of petrol relatively price inelastic?
May/June 2011
A refinery that converts oil into petrol (gas) is dealing with the conditions below. 1 It is operating at full capacity. 2 Its petrol storage tanks are already full. 3 It has taken delivery of a new fleet of petrol tankers to move its petrol. 4 It takes six months to train new workers so that they are qualified in safety procedures. Which of these conditions would make the supply of petrol relatively price inelastic?
May/June 2011
A refinery that converts oil into petrol (gas) is operating under the following circumstances. 1 It is running at full capacity. 2 Its petrol storage tanks are full. 3 It has been delivered a new fleet of petrol tankers for transporting its petrol. 4 It takes six months to train new workers to meet safety procedures. Which of these conditions will tend to make the supply of petrol relatively price inelastic?
May/June 2011
Explain how and why the price elasticity of supply of agricultural goods is different from that of manufactured goods.
May/June 2011
For a product whose supply is infinitely elastic, weekly sales are 1000 units when the price is $1 per unit. Price elasticity of demand is 1.5 across the relevant range. The government introduces a tax of 10%. What will be the government’s weekly tax revenue?
May/June 2011
A product with infinite elasticity of supply sells 1000 units each week when the price is $1 per unit. Price elasticity of demand is 1.5 over the relevant range. The government introduces a tax of 10%. What is the government’s weekly tax revenue?
May/June 2011
A product with infinite elasticity of supply sells 1000 units each week at a price of $1 per unit. Over the relevant range, price elasticity of demand is 1.5. The government introduces a tax of 10%. What is the government’s weekly tax revenue?
May/June 2011
Two firms, X and Y, supply the tractor market, and each one initially has 50 % of the market. If the price of tractors rises by 10 %, firm X increases output by 10 % and firm Y raises output by 20 %. What is the price elasticity of supply of tractors in this market?
May/June 2012
The supply function for good X is represented by QS = 10PX, where PX denotes the good’s price and QS represents the quantity supplied. What conclusion can be drawn from this equation about the elasticity of supply of good X?
May/June 2013
Use the data to estimate the price elasticity of supply of scrap gold between 2003 and 2009 and say whether it is elastic or inelastic.
May/June 2013
The diagram depicts a supply curve. Which statement best describes the price elasticity of supply on this curve?
May/June 2014
The diagram illustrates four distinct straight-line supply curves. What conclusion can be drawn from the diagram?
May/June 2014
A company manufactures televisions. What does the firm’s supply elasticity indicate?
May/June 2014
Explain whether you would expect the price elasticity of supply of an agricultural product, such as rice, in a market to be elastic or inelastic.
May/June 2014
The price of a good rises to twice its original level, but firms can increase output by only 10%. This is an example of
May/June 2015
A firm’s product price increases by 12%. One week later, the firm is still able to make only the same quantity, but after one month it can raise output by 6%. How would the price elasticity of supply be described after one week and after one month?
May/June 2015
What is the probable nature of the price elasticity of supply for a crop such as rice?
May/June 2015
Explain two factors that are likely to result in the supply of a product being relatively price inelastic.
May/June 2015
A product whose supply is infinitely elastic sells 1000 units each week at a price of $1 for each unit. Price elasticity of demand is 1.5 over the relevant range. The government introduces a tax of 10%. What will be the weekly tax revenue collected by the government?
May/June 2016
An ‘App’ for a phone has a perfectly elastic price elasticity of supply. At present, each ‘App’ sells for $10 and 200 ‘Apps’ are sold each day. As the ‘App’ gains popularity, demand rises by 50% at every price. What will be the effect of this change in demand?
May/June 2016
SX, SY and SZ show the supply curves for goods X, Y and Z. When the price of each of the three goods increases from $5 to $10, what are the values of their price elasticity of supply?
May/June 2016
A manufacturer’s capacity to raise supply in the short run will be higher
May/June 2016
A firm finds that the price elasticity of supply for its product is 0.3. What is likely to be true about the firm?
May/June 2017
A product’s supply function may be expressed as Q = 2P + 10, where Q is the quantity supplied, measured in kilos, and P is the price per kilo in dollars. The price drops from $15 to $10 per kilo. The value of price elasticity of supply for this price change falls within a range from
May/June 2017
A bottle-making firm said that it had adopted a new production system. Because of this, the amount made each week could be increased or decreased much more easily whenever bottle prices changed. What term is used to describe this change?
May/June 2017
A firm faces a perfectly elastic supply curve at the market price of $10. Which statement about the firm is true?
May/June 2017
A good’s supply function may be expressed as Q = 2P + 10, where Q denotes the quantity supplied in kilos and P denotes the price per kilo in dollars. The price increases from $10 to $15 per kilo. The value of price elasticity of supply for this price increase is in the range from
May/June 2017
If the price of cell (mobile) phones goes up from US$100 to US$110 and the quantity supplied rises from 200 to 250, what is the price elasticity of supply?
May/June 2018
A product shows a high price elasticity of supply. What could account for this?
May/June 2018
A government wants to levy a tax on a product so that most of the tax burden falls on the producer rather than the consumer. Which kind of elasticity should the good have to make this happen?
May/June 2018
A good has a price elasticity of supply of +2. Its initial quantity supplied was 200 units. The price then rises by 30%. What will the quantity supplied be after this rise in price?
May/June 2018
Consumers experience a rise in their incomes. Under which circumstances would the quantity of the product sold rise by the greatest amount?
May/June 2019
The table gives the amount of a product supplied at two price levels by four firms, A, B, C and D. Which firm has a price elasticity of supply of 1 when the price drops from $10 to $8?
May/June 2019
The diagram illustrates the supply of limestone from quarry X and quarry Y at two different prices. What is the measure of supply responsiveness as the price rises from P1 to P2?
May/June 2019
The diagrams illustrate the supply curves for four separate markets. In which market is the price elasticity of supply always equal to one?
May/June 2019
In which situation would the supply curve of a car manufacturing firm be most likely to be price elastic?
May/June 2019
How could a firm make the price elasticity of supply of its product higher?
May/June 2020
A specific tax is levied on a product whose elasticity of supply is zero. Which statement is correct?
May/June 2020
A good has a price elasticity of supply of 2.0. At a market price of $20 per unit, the quantity supplied is currently 300 units per week. The firm increases the price to $25 per unit. What will the quantity supplied be per week now?
May/June 2020
The diagram illustrates the supply curve for a product. The government levies a specific indirect tax of $5 on the product. How will the product's price elasticity of supply change?
May/June 2020
The supply (S) of a product is given by the equation S = 10 + 10P, where P represents the product’s price in $. What is the product’s price elasticity of supply when the price increases from $1 to $2?
May/June 2020
Explain whether you would expect the price elasticity of supply of water to be relatively elastic or relatively inelastic.
May/June 2020
Explain price elasticity of supply and suggest why these estimates are different.
May/June 2020
The price elasticity of supply for the good is elastic. If all output is sold, which combination accurately shows the relationship between the effect of a rise in price on the quantity supplied and the firm’s total revenue received?
May/June 2021
Which statement correctly describes price elasticity of supply?
May/June 2021
A market is initially in equilibrium, with 100 units of the product being sold at a price of US$10 each. The price elasticity of supply for the product is +2.0 and the price elasticity of demand is –1.0. What will be the condition of the market if a minimum price of US$11 is introduced?
May/June 2021
A product shows a low price elasticity of supply. What could account for this?
May/June 2021
A car manufacturer estimates that the price elasticity of supply for its cars is +2.5. What effect will a 10% rise in price have?
May/June 2021
What does the term price elasticity of supply mean?
May/June 2022
In which circumstance is the price elasticity of supply for a product most likely to be relatively low?
May/June 2022
Over a short time span, the supply of a new drug used to relieve muscle pain is highly inelastic. By contrast, the supply of printed newspapers is far more elastic over that same period. What might account for the difference in supply elasticity between the drug and printed newspapers during this time period?
May/June 2022
Explain two factors that determine the price elasticity of supply of a manufactured product.
May/June 2022
At a price of $2.00 for good X, the quantity supplied is 100 000. The price elasticity of supply of good X is 0.8 in the short run and 1.4 in the long run. If the price of good X rises to $2.20, by how much does the quantity supplied of good X increase between the short run and the long run?
May/June 2023
The diagram illustrates the supply curve of a firm. Which statement about the price elasticity of supply (PES) on this curve is correct?
May/June 2023
The diagram illustrates four supply curves W, X, Y and Z. Which statement about the price elasticity of these supply curves is accurate?
May/June 2023
Product X has a price elasticity of supply (PES) of +2, whereas product Y has a PES of +0.2. Which statement about products X and Y is correct?
May/June 2023
The diagram illustrates the supply curve for a product. The government levies a specific indirect tax of $5 on the product. How will the price elasticity of supply of the product change?
May/June 2024
Which business is most likely to be the slowest to change its output when demand for its product rises and remains high?
May/June 2024
Using a formula, explain what is meant by the income elasticity of demand for a product and assess the extent to which demand for the product will always rise at the same rate as the income of its consumers.
May/June 2024
Which explanation best accounts for the fact that the price elasticity of supply (PES) is likely to be lower for fresh vegetables produced inside a country than for goods manufactured in that same country?
May/June 2025
The diagram illustrates the short-run supply curve (SSR) and long-run supply curve (SLR) for a bakery. The price of a loaf of bread rises from $2.00 to $2.20. What is the bakery’s price elasticity of supply (PES) in the short run and in the long run when the price of a loaf of bread rises?
May/June 2025
A construction firm estimates that the price elasticity of supply for building a nuclear power plant is +0.1. What could account for this?
May/June 2025
A theatre has a set quantity of tickets available for each performance. What is meant by the price elasticity of supply?
May/June 2025
Explain three reasons, linked to costs of production, why the supply curve in a particular market may move to the right and consider how far government microeconomic policy may also move the supply curve in a particular market to the right.
May/June 2025
Explain what these estimates imply for producers of smartphones that use semi-conductors, and take into account the significance of the long-run estimate.
May/June 2025
Explain how elastic, inelastic and fixed supply differ.
Oct/Nov 2004
A government wants to place a tax on a good in such a way that the consumer, rather than the producer, bears most of the rise in tax. Which type of elasticity would be most effective in achieving this objective?
Oct/Nov 2009
In the diagram, OS1 and OS2 are both straight-line supply curves. When price rises, the elasticity of supply
Oct/Nov 2010
In the diagram, OS1 and OS2 are two straight-line supply curves. When price rises, the elasticity of supply
Oct/Nov 2010
The diagram shows OS1 and OS2 as two straight-line supply curves. When price rises, the elasticity of supply
Oct/Nov 2010
A firm calculates that the price elasticity of supply for its product is 0.4. Should the firm be concerned about this figure?
Oct/Nov 2011
What conclusion can be drawn about the price elasticity of supply for the curves shown?
Oct/Nov 2011
How much is the market supply of X likely to rise when the price of product X increases from $22 to $36?
Oct/Nov 2011
In what circumstances is an increase in a product’s price likely to lead to more resources being devoted to producing it?
Oct/Nov 2011
A manufacturer has calculated that the price elasticity of supply of ice cream is +1.5. If demand for ice cream increases and the price rises by 10 %, by how much will the manufacturer increase the quantity supplied to the market?
Oct/Nov 2011
An industry is made up of three firms, R, S and T, that manufacture product X. By how much would an increase in the price of product X from $22 to $36 be expected to raise the market supply of X?
Oct/Nov 2011
A business calculates that the price elasticity of supply for its product is 0.4. Is this a figure that should worry the business?
Oct/Nov 2011
The diagram presents three supply curves. What conclusion can be drawn about the price elasticity of supply of these curves?
Oct/Nov 2011
In a market economy, if demand for a product rises and the price goes up while output stays the same, what might account for this?
Oct/Nov 2012
A government wants to levy a tax on a good so that most of the tax burden is borne by the producer rather than the consumer. Which type of elasticity should the good have in order to make this possible?
Oct/Nov 2012
A good’s supply function may be expressed as Q = 2P + 10, in which Q denotes the quantity supplied in kilos and P denotes the price per kilo in dollars. The price increases from $10 to $15 per kilo. The value of price elasticity of supply for this price increase falls within a range from
Oct/Nov 2013
If demand for a good rises, the equilibrium price does not change. What is the good’s elasticity of supply?
Oct/Nov 2014