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Exercises · Q12

Q.Choose the correct alternative and justify: A straight-line supply curve that passes through the origin shows —

(a) Perfectly elastic supply
(b) Perfectly inelastic supply
(c) Unitary elastic supply
(d) Relatively inelastic supply.
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Option (a), Perfectly elastic — incorrect. Perfectly elastic supply (Es=∞E_s=\infty) is shown by a HORIZONTAL supply curve, not one passing through the origin.

Option (b), Perfectly inelastic — incorrect. Perfectly inelastic supply (Es=0E_s=0) is shown by a VERTICAL supply curve (fixed quantity regardless of price), which does not pass through the origin at a positive slope either.

Option (c), Unitary elastic — CORRECT. For a straight-line supply function of the form Qs=bPQ_s = bP (through the origin, no constant term), price elasticity works out to Es=b×P/(bP)=1E_s = b \times P/(bP) = 1 at EVERY point on the line, whatever the value of the slope bb. This is a standard, testable geometric fact in the MSBSHSE Std XII Economics point-method of measuring elasticity of supply. …

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