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Supply/Demand - Elastic/Inelastic Question (Check My Work)?

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The supply of apples is determined by the size of orchards, the number of apple trees, and the quantity of apples per tree. The quantity of apples per tree depends on the weather and the amount of fertilizer and pesticides that farmers use. Given all these factors that affect supply, is the long-run supply of apples likely to become more elastic or more inelastic than the short-run supply?

A. The elasticity of supply will be the same in the short and long run.

B. The long-run supply of apples will be more inelastic.

C. The long-run supply of apples will be more elastic.

My Approach: I feel that C is the right answer because in the long-run we don't know how much supply of apples there will be; thus, i conclude that it's a more elastic supply. What does everyone else think?

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2 ANSWERS


  1. C. The long-run supply of apples will be more elastic.

    C is right answer - supply for most goods is relatively more elastic in long-run comparing to short-run - because factors of production can be adjusted more easily in long-run.


  2. Supply elasticity is equal to percent change in quantity divided by percent change in price.      Typically speaking, for a good, like apples, which are not based on a fixed, long-term potential supply (let's say like the fixed amount of oil on the planet) there is flexibility to adjust the supply in the long run... particularly if you assume the long run means enough years to grow more trees.  

    Compare this to the short run, where storms, floods, droughts may affect a particularly growing season.

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