In microeconomics, the main determinant of the price elasticity of supply is the:

• A. Amount of time producers have to respond to a price change
• B. Size of the price change faced by consumers
• C. Level of market concentration among suppliers
• D. Income elasticity of demand for the product

Answer: (A)

Verified step by step guidance

1. Understand that the price elasticity of supply measures how much the quantity supplied of a good responds to a change in its price.
2. Recall that the main determinant of price elasticity of supply is related to how quickly and easily producers can adjust their production in response to price changes.
3. Consider the role of time: in the short run, producers may have limited ability to change production, making supply less elastic; in the long run, they can adjust all inputs, making supply more elastic.
4. Evaluate other options such as size of price change, market concentration, and income elasticity of demand, and recognize that these factors do not primarily determine the elasticity of supply.
5. Conclude that the amount of time producers have to respond to a price change is the key factor influencing the price elasticity of supply.