Assertion: When the supply curve is vertical, the elasticity of supply is undefined.
Reasoning: When the supply curve is vertical, supply is completely insensitive to price.
Answer & explanation
Correct answer: option 4
The correct answer is Option 4: Assertion (A) is not true but Reasoning (R) is correct.
Assertion:When the supply curve is vertical, the elasticity of supply is undefined.This assertion is incorrect. When the supply curve is vertical, the elasticity of supply is zero, not undefined.
Reasoning: When the supply curve is vertical, supply is completely insensitive to price. This reasoning is correct. A vertical supply curve means that the quantity supplied remains constant regardless of changes in price. This indicates perfectly inelastic supply.