If the supply of steel is perfectly elastic,then an increase in the demand for steel will
A)increase the price of steel but have no effect on quantity supplied.
B)increase the quantity of steel supplies but have no effect on the price.
C)have no effect on the price or the quantity supplied.
D)decrease total revenue taken in by steel producers.

Question

Quizplus · Accepted Answer

If the supply of steel is perfectly elastic, it means the quantity supplied can be increased without an increase in price. Therefore, an increase in demand for steel will only lead to an increase in the quantity supplied but not the price. This is because suppliers can easily adjust their output to meet the demand without affecting the price.

If the Supply of Steel Is Perfectly Elastic,then an Increase