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Marketeconomics-mcqs › market
Published
31 May 2019
Last updated
28 May 2026

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When a demand curve shifts, under which condition will the change in price be more significant than the change in quantity?

Multiple choice question for Market. Select an option, then review the explanation below.

Choose the correct answer

Explanation

When supply is perfectly elastic (elasticity equals infinity), suppliers are willing to provide any quantity at a fixed price. Therefore, a shift in demand will primarily affect the quantity rather than the price. Conversely, if supply elasticity is infinite, price changes are more pronounced than quantity changes because supply cannot adjust quantity. Hence, the price effect dominates when supply elasticity is infinite.

Practice related questions from the same subject.

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  5. 5.Why is a competitive equilibrium considered Pareto efficient?

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