If a 30 percent change in price causes a 15 percent change in quantity supplied,then the price elasticity of supply is about
A)0.5,and supply is elastic.
B)0.5,and supply is inelastic.
C)2,and supply is inelastic.
D)2,and supply is elastic.

Question

Quizplus · Accepted Answer

The price elasticity of supply is calculated as the percentage change in quantity supplied divided by the percentage change in price. Here, it is 15% / 30% = 0.5. Since the elasticity is less than 1, the supply is inelastic.

If a 30 Percent Change in Price Causes a 15