When the price changes from $1.99 per gallon of milk to $3.25 per gallon, the quantity supplied did not change. the supply of milk in the United States is closest to being:
A. perfectly elastic, elasticity of supply=0
B. perfectly elastic, elasticity of supply=infinity
C. perfectly inelastic, elasticity of supply=0
D. perfectly inelastic, elasticity of supply=infinity
The book says answer C, but why is the slope equal to 0? I would think (looking at the graph and remembering back to high school math) that a perpendicular inelastic slope means price/quantity is dividing by 0, a slope of infinity.
Richard |