Match the curve in List-I with its feature in List-II:
| List-I | List-II | ||
|---|---|---|---|
| (A) | Total revenue curve of a price-taking firm | (I) | Price elasticity of supply equal to zero |
| (B) | Price line | (II) | Price elasticity of supply equal to one at every point |
| (C) | Vertical supply curve | (III) | An upward rising straight line that passes through the origin |
| (D) | Straight-line supply curve through the origin | (IV) | A horizontal straight line at a height equal to the market price |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → (A) - (III), (B) - (IV), (C) - (I), (D) - (II)
| List-I | List-II | Reason |
|---|---|---|
| (A) Total revenue curve of a price-taking firm | (III) An upward rising straight line that passes through the origin | TR is zero at zero output, and TR = p × q rises in a straight line because p is constant. |
| (B) Price line | (IV) A horizontal straight line at a height equal to the market price | The price is the same at every output, so the line is horizontal at height p. |
| (C) Vertical supply curve | (I) Price elasticity of supply equal to zero | The quantity supplied does not change with price, so eS = 0. |
| (D) Straight-line supply curve through the origin | (II) Price elasticity of supply equal to one at every point | M coincides with the origin, so eS = Oq0/Oq0 = 1. |
NCERT (2026-27): “4.2 Revenue … Three observations are relevant here. First, when the output is zero, the total revenue of the firm is also zero. Therefore, the TR curve passes through point O. Second, the total revenue increases as the output goes up. Moreover, the equation ‘TR = p × q’ is that of a straight line because p is constant. This means that the TR curve is an upward rising straight line. …” “4.2 Revenue … Now consider Figure 4.2. Here, we plot the average revenue or market price (y-axis) for different values of a firm’s output (x-axis). Since the market price is fixed at p, we obtain a horizontal straight line that cuts the y-axis at a height equal to p. This horizontal straight line is called the price line. …” “4.7 Price Elasticity of Supply … When the supply curve is vertical, supply is completely insensitive to price and the elasticity of supply is zero. …” “The Geometric Method … At any point on a straight line, supply curve going through the origin price elasticity will be one.” |