Why do some firms experience elastic supply curves at low levels of quantity supplied and more inelastic supply curves at higher levels of quantity supplied
A)At lower levels of quantity supplied, these firms have idle capacity.
B)At higher levels of quantity supplied, these firms incur lower production costs.
C)At lower levels of quantity supplied, these firms incur higher production costs.
D)At higher levels of quantity supplied, these firms have idle capacity.

Question

Quizplus · Accepted Answer

At lower levels of quantity supplied, firms often have idle capacity, allowing them to increase production without significant increases in cost, leading to more elastic supply. As production increases and capacity is utilized, it becomes harder to increase supply, making it more inelastic.

Why Do Some Firms Experience Elastic Supply Curves at Low