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April 17, 2014

Homework Help: Economics

Posted by David on Monday, February 28, 2011 at 7:30pm.

Are these examples of elastic/inelastic supply products correct?

Plane tickets:
A plane ticket is an example of inelastic supply. If the price of a ticket changes, the airline cannot quickly increase the supply of seats. It takes a long time to make more planes to provide seats for customers. Therefore, as the price of a plane ticket changes, the supply does not change.

Gold:
Golf is an example of inelastic supply. The price of golf is always changing. However, there is a limited supply of gold in the world and mining and producing it is a lengthy process. Therefore, as the price of golf changes, the supply will not change very much.

Oranges:
An orange is and example of inelastic supply. Growing oranges takes a long time. If the price of oranges increase, producers cannot simply grow more oranges. They must wait for their next harvest. Therefore, as the price of oranges changes, the supply does not change.

Clothing:
Clothing is an example of elastic supply. If the price of clothing changes, the producer can account for this change in price by changing production (hiring/firing workers, increasing/decreasing shifts, ext). Therefore, as the price of clothing changes, the supply will also change.

DVD players.
A DVD player is an example of elastic supply. If the price of a DVD player changes, the producer can account for this change in price by changing production (hiring/firing more workers, increasing/decreasing shifts, ext). Therefore, as the price of DVD players changes, the supply will also change.

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