Answered: Consider the supply of coal. What would…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter20: Elasticity: Demand And Supply

Section: Chapter Questions

Problem 5E

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Question

Consider the supply of coal. What would make the supply of coal more elastic? The supply of coal would become more elastic if

A. The time horizon becomes longer.

B. It becomes a larger portion of a consumer's budget

C. more substitutes were available.

D. it were more of a luxury.

Expert Solution

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Elasticity refers to a term used in economics to describe how responsive one economic variable is to changes in another, such as the price of an item or service or the quantity requested or provided of that good or service. Elasticity, more specifically, quantifies the percentage change in one variable that results from a 1% change in the other.

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