Perfectly inelastic (zero elastic) supply, Managerial Economics

Assignment Help:

Perfectly Inelastic (Zero Elastic) Supply

Supply is said to be perfectly inelastic if the quantity supplied is constant at all prices.  The supply curve is a vertical straight line and the elasticity of supply is equal to zero.

When price rises from P1 to P2, quantity supplied stays fixed at q, and when price falls from P2 to P1, quantity supplied stays fixed.

In the case of a price rise, this is the situation of the very short-run or the momentary period which is so short that the quantity supplied cannot be increased, e.g. food brought to the market in the morning.  It is also the case where the commodity is fixed in supply e.g. land.  In the case of a price fall, this is the case of a highly perishable commodity which cannot be stored, e.g. fresh fish.

 


Related Discussions:- Perfectly inelastic (zero elastic) supply

What are the essential conditions for perfect completion, What are the esse...

What are the essential conditions for perfect completion? Two essential conditions for perfect competition are as given below: a. Various producers, none of whom have a hug

Derevatives ., how to solve problems using derivatives ?

how to solve problems using derivatives ?

Interest rates, Interest rates Decreasing the rate of interest may...

Interest rates Decreasing the rate of interest may not encourage investment but increasing the interest rate tends to lock up liquidity in the financial system.

Identity economics help to explain economic questions, What is identity eco...

What is identity economics? How does identity economics help to explain economic questions that standard economics fails to address?

Collective bargaining, Collective bargaining Collective bargaining  ...

Collective bargaining Collective bargaining  refers to the whole process by which trade unions and employers (or their representatives) arrive at an enforce agreements.  Tra

Simple macro model, Using the same simple macro model we developed in Modul...

Using the same simple macro model we developed in Module 2: a.  Show what will happen to national income (GDP) if the administration implements another $100 (billion) stimulus s

Calculate the firms short-run total cost curve, A firm producing hockey sti...

A firm producing hockey sticks has a production function given by X = 2 KL In the short-run, the firm's amount of capital equipment is fixed at K = 1000. The rental rate fo

Quantitative Analysis, How has quantitative analysis changed the current sc...

How has quantitative analysis changed the current scenario in the management world today? Focus must be on the business world specifically in the context of Asian Countries.

The effects of globalization on indian industry, Indian industry has progre...

Indian industry has progressed a lot because of globalization. A lot of development has been seen in Indian industry.

Using total expenditure for calculating national income, Using Total Expend...

Using Total Expenditure for Calculating National Income The expenditure approach centres on the components of final demand which generate production.  It thus measures GDP

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd