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Suppose the Price Elasticity of Supply for Cheese Is 0

Question 212

Multiple Choice

Suppose the price elasticity of supply for cheese is 0.6 in the short run and 1.4 in the long run. If an increase in the demand for cheese causes the price of cheese to increase by 15 percent, then the quantity supplied of cheese will increase by


A) 0.4 percent in the short run and 4.6 percent in the long run.
B) 1.7 percent in the short run and 0.7 percent in the long run.
C) 9 percent in the short run and 21 percent in the long run.
D) 25 percent in the short run and 10.7 percent in the long run.

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