The price elasticity of supply of a good is 0.8. Its price rises by 50 per cent. Calculate the percentage increase in its supply.

Lyric Pitts

Lyric Pitts

Answered question

2023-03-25

The price elasticity of supply of a good is 0.8. Its price rises by 50 per cent. Calculate the percentage increase in its supply.

Answer & Explanation

Katrina Oconnell

Katrina Oconnell

Beginner2023-03-26Added 4 answers

E s = Percentage change in quantity supplied Percentage change in price 0.8 = Percentage change in quantity supplied 50 Percentage change in quantity supplied = 0.8 × 50 Percentage change in quantity supplied = 40 %

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