Which of the following statements about price elasticity of supply is true?

Group of answer choices：

It is a unit-free measure by using the magnitude change.

Its sign shows how sensitive it is to the change in price.

It is normally positive due to the law of supply.

It is a direction-free measure by using an initial value.

Expert Solution

Answer Option)Its sign shows how sensitive it is to the change in price.

Price elasticity of supply represents how much change in in supply due to percentage change in price.

Therefore,it shows how sensitive it is to the change in price

Rahul Sunny answered 2 years ago

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