Question: Valid points, whether a shift in the demand curve results in a greater relative change in the equilibrium price or the equilibrium quantity depends on
Valid points, whether a shift in the demand curve results in a greater relative change in the equilibrium price or the equilibrium quantity depends on the shape of the supply curve. If the supply curve is fairly flat, or elastic, the change will be primarily in the equilibrium quantity (see Figure 6.6). An elastic supply curve means that a small change in price typically results in a greater response in the provided quantity. If the supply curve is fairly vertical, or inelastic, the change in equilibrium will be mostly seen as a price change
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
