To determine which time period would have the greatest impact on the elasticity of supply for a product like airplanes, let's understand each time period in terms of the suppliers' ability to respond to changes in demand:
1. 1 year: A year is a significant amount of time, allowing suppliers to make some adjustments. They could potentially increase production, hire more workers, or invest in new facilities.
2. 1 month: This is a rather short period, limiting the suppliers' ability to make substantial changes. Adjustments may be minimal, such as overtime work or minor increases in production efficiency.
3. 6 months: This period is moderately longer than a month but still under a year. Suppliers might have more leeway to make adjustments compared to a month. They could begin scaling production, but major changes like building new factories would be unlikely.
4. 5 years: This is the longest period discussed. Over five years, suppliers have significant time to respond to changes in demand. They can make extensive adjustments including research and development, opening new production facilities, recruiting and training a workforce, and even forming new partnerships.
Given these time periods:
- 5 years would present the greatest impact on the elasticity of supply.
The long period allows ample time for suppliers to expand production significantly, innovate, enter new markets, and strategically plan their operations. Such elasticity means that supply can more readily meet demand changes over this extended period.
Therefore, the time period of 5 years has the greatest impact on the elasticity of supply for a product like airplanes.
