Economics (AS & A Level) · May / June 2024 · Paper 13 · Question 14

The diagram shows the supply curve of a product. The government imposes a specific indirect tax of $5 on the product. How will the price elasticity of supply of the product change?

1. Afrom elastic (>1) to inelastic (<1)
2. Bfrom inelastic (<1) to elastic (>1)
3. Cfrom inelastic (<1) to unitary (=1)
4. Dfrom unitary (=1) to elastic (>1)

As printed in the paper