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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

The supply of paintings by Leonardo Da Vinci, who painted the Mona Lisa and The Last Supper and died in 1519, is highly inelastic. Sketch a supply and demand diagram, paying attention to the appropriate elasticities, to illustrate that demand for these paintings will determine the price.

To determine

To determine: The supply of paintings by Leonardo Da Vinci is highly inelastic. Draw the diagram of demand and supply and show that the price is primarily determined by the demand curve.

Explanation

Since, the paintings by Leonardo Da Vinci are limited in quantity so the supply of these paintings would be highly inelastic. The supply curve is vertical, parallel to y-axis. The price of such paintings can only be determined when the demand curve intersects the vertical supply curve. Below is the diagram which shows the demand curve and vertical supply curve.

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