If a 20% change in price results in a 15% change in quantity supplied,then the price elasticity of supply is about
A)1.33,and supply is elastic.
B)1.33,and supply is inelastic.
C)0.75,and supply is elastic.
D)0.75,and supply is inelastic.

Question

Quizplus · Accepted Answer

Price elasticity of supply is calculated as the percentage change in quantity supplied divided by the percentage change in price. Here, it is 15%/20% = 0.75, which is less than 1, indicating that supply is inelastic.

If a 20% Change in Price Results in a 15