If the supply of a product is elastic, a small reduction ...
If the supply of a product is elastic, a small reduction in price will
Reduce the cost of production
Reduce the quantity supplied
Increase the quantity supplied
Lead to no change in the quantity supplied
Correct answer is B
Elastic demand means a change in price would cause a change in the quantity demanded. In an elastic demand, a small reduction in price would increase the quantity demanded and a decrease in the quantity supplied. This is so because, suppliers will not be willing to supply much goods when the price for it is low.
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