If a 23 percent change in price results in a 21 percent change in quantity supplied, then the price elasticity of supply is about
A)1.10, and supply is elastic.
B)1.10, and supply is inelastic.
C)0.91, and supply is inelastic.
D)0.91, 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, which is 21% / 23% = 0.91. A value less than 1 indicates inelastic supply.

If a 23 Percent Change in Price Results in a 21