For each straight-line supply curve in List-I, M is the point where the line (extended if needed) cuts the quantity axis, and q0 is the quantity supplied at a point S on it. Match List-I with the price elasticity of supply at S in List-II:
| List-I | List-II | ||
|---|---|---|---|
| (A) | M at −20 units; q0 = 40 units | (I) | 1 |
| (B) | The line passes through the origin | (II) | 1.5 |
| (C) | M at 10 units; q0 = 50 units | (III) | 1.25 |
| (D) | M at −10 units; q0 = 40 units | (IV) | 0.8 |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A) - (II), (B) - (I), (C) - (IV), (D) - (III)
By the geometric method, eS at S = Mq0/Oq0. Mq0 is the distance from M to q0 on the quantity axis.
| List-I | List-II | Reason |
|---|---|---|
| (A) M at −20 units; q0 = 40 units | (II) 1.5 | Mq0 = 40 + 20 = 60, so eS = 60/40 = 1.5. |
| (B) The line passes through the origin | (I) 1 | M is at O, so Mq0 = Oq0 and eS = 1. |
| (C) M at 10 units; q0 = 50 units | (IV) 0.8 | Mq0 = 50 − 10 = 40, so eS = 40/50 = 0.8. |
| (D) M at −10 units; q0 = 40 units | (III) 1.25 | Mq0 = 40 + 10 = 50, so eS = 50/40 = 1.25. |
NCERT (2026-27): “The Geometric Method Consider the Figure 4.14. Panel (a) shows a straight line supply curve. S is a point on the supply curve. It cuts the price-axis at its positive range and as we extend the straight line, it cuts the quantity-axis at M which is at its negative range. The price elasticity of this supply curve at the point S is given by the ratio, Mq0/Oq0. For any point S on such a supply curve, we see that Mq0 > Oq0. The elasticity at any point on such a supply curve, therefore, will be greater than 1.” “The Geometric Method … Now we come to panel (b). Here the supply curve goes through the origin. One can imagine that the point M has coincided with the origin here, i.e., Mq0 has become equal to Oq0. The price elasticity of this supply curve at the point S is given by the ratio, Oq0/Oq0 which is equal to 1. At any point on a straight line, supply curve going through the origin price elasticity will be one.”
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