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Figure 2.16 Elasticity of a Linear Supply Curve
The ratio between price and quantity (P/Q) and the magnitude of the elasticity of a supply curve decrease as we move up the curve. At point A, Q = 0, P/Q = ∞, and the price elasticity of supply is ∞. From B to C to D, the decrease in P/Q is reflected in the decrease of the slopes of the rays from these points to the origin. Unlike the demand curve, the price elasticity of supply will never reach zero because the supply curve never intercepts the quantity axis.