Question: The quantity supplied and the price of product A are given as follows:
| Price (Rs Per Kg.) | Quantity Supplied (Kgs. in thousands) |
| 45 | 50 |
| 55 | 50 |
| 65 | 50 |
Draw a supply curve for the supply schedule and find the type of elasticity of supply using the curve.
Solution:
The supply curve for product A is shown in Figure
Above Figure shows that the supply of product A remains constant at 50,000 kgs. However, the price changes from Rs 45 to Rs 65 at the same supply rate. Therefore, the supply of product X is perfectly inelastic (e = 0).