When a change in price causes no change in quantity supplied (PES = 0), this describes:

When a change in price causes no change in quantity supplied (PES = 0), this describes:

• A. Perfectly Elastic Supply
• B. Perfectly Inelastic Supply
• C. Unit Elasticity of Supply
• D. Elastic Supply

Answer: (B)

Price elasticity of supply measures how much quantity supplied responds to a price change. If a change in price does not change the amount producers are willing to supply, the elasticity is zero, so the supply is perfectly inelastic. This means the quantity supplied is fixed regardless of price, often because production capacity is limited in the short run (for example, a factory that cannot increase output because machines or staffing are already maxed out). In contrast, other types describe some responsiveness: perfectly elastic implies an infinitesimal price change would create an infinite change in quantity, unit elastic means quantity changes in exact proportion to price, and elastic supply means quantity responds to price changes but not to the extreme.

Price elasticity of supply measures how much quantity supplied responds to a price change. If a change in price does not change the amount producers are willing to supply, the elasticity is zero, so the supply is perfectly inelastic. This means the quantity supplied is fixed regardless of price, often because production capacity is limited in the short run (for example, a factory that cannot increase output because machines or staffing are already maxed out). In contrast, other types describe some responsiveness: perfectly elastic implies an infinitesimal price change would create an infinite change in quantity, unit elastic means quantity changes in exact proportion to price, and elastic supply means quantity responds to price changes but not to the extreme.