A factory produces metal storage lockers. When the price of a locker rises permanently, the factory's cutting machines are already operating close to full capacity, and its machine operators need specialist training.
The table shows the factory's response to the price rise. Other conditions remain unchanged.
| Time | Price per locker | Weekly quantity supplied |
|---|---|---|
| Before the price rise | £80 | 5,000 |
| One month after the price rise | £88 | 5,150 |
| Four years after the price rise | £88 | 6,250 |
Calculate the price elasticity of supply after one month and after four years.
Using your answers to part (a), identify whether supply is price elastic or price inelastic after one month and after four years.
Using the information about the factory, explain one reason why its supply is price inelastic one month after the price rise.
81 exam-style questions on OCR GCSE Economics 2.3 Supply, covering 2.3.1 What is supply, 2.3.2 Draw a supply curve using data, 2.3.3 Explain a supply curve, 2.3.4 Shifts and movements of the supply curve, 2.3.5 Causes and consequences of supply changes, 2.3.6 Price elasticity of supply, 2.3.7 Draw supply curves of different elasticity, and 2.3.8 Importance of price elasticity of supply. Each one has a worked solution and a mark scheme showing where the marks go.