📚 Learning Guide
Price Elasticity of Supply
medium

In the context of supply responsiveness, if a price increase leads to a significant increase in quantity supplied, this is analogous to a situation where a rise in temperature leads to what kind of response in ice melting? A:B :: C:?

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Choose the Best Answer

A

Rapid melting

B

Slow melting

C

No melting

D

Freezing

Understanding the Answer

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Answer

In the context of supply responsiveness, when a price increase leads to a significant increase in quantity supplied, it is similar to how a rise in temperature causes ice to melt quickly. Just as the heat makes ice turn into water, prompting a fast response, a higher price encourages producers to supply more goods. This relationship highlights how changes in one factor can lead to noticeable changes in another. For example, if the price of oranges rises significantly, farmers might increase their production to take advantage of the higher prices, just like ice melting rapidly when it gets warm. Therefore, if we think of the price increase as "A" and the significant increase in quantity supplied as "B," then the rise in temperature is "C" and the ice melting is the response, making the analogy clear: A:B :: C:ice melting.

Detailed Explanation

When the temperature rises, ice melts quickly. Other options are incorrect because Some might think melting happens slowly; Thinking there is no melting is a mistake.

Key Concepts

Price Elasticity of Supply
Supply Responsiveness
Market Behavior
Topic

Price Elasticity of Supply

Difficulty

medium level question

Cognitive Level

understand

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