ECON 201 Study Guide - Midterm Guide: Production Quota, Postmedia News, Bp

• School: Concordia University
• Department: Economics
• Course: ECON 201
• Professor: All

Document Summary

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 for apples likely to become more elastic or more inelastic than the short-run supply? (from aplia) a. The long-run supply for apples will be more inelastic: the long-run supply for apples will be more elastic. c. d. e. The elasticity of supply will be the same in the short and long run. The elasticity of the long-run supply is dependent on the shape of the demand curve. Taxicab fares in cleveland are subject to maximum price regulations set by the city government. Suppose that the local taxi companies petition the city council to raise the fares to generate higher revenues.