Supply will tend to be more price elastic when a:
A) factory has spare capacity.
B) factory is running at capacity.
C) fast-food restaurant is facing falling demand.
D) fast-food restaurant loses an oven.

Question

Quizplus · Accepted Answer

Supply tends to be more price elastic when a factory has spare capacity because it can more easily increase production in response to price increases without incurring significant additional costs.

Supply Will Tend to Be More Price Elastic When A