Table 5.6
$$\begin{array} { | c | c | }
\hline \text { Quantity Supplied } & \text { Frice } \
\hline 10 & \$ 10 \
\hline 20 & \$ 20 \
\hline 30 & \$ 30 \
\hline 40 & \$ 40 \
\hline 50 & \$ 50 \
\hline
\end{array}$$
-Refer to Table 5.6.If price decreases from $50 to $30,the price elasticity of supply is:
A)10
B)5
C)1
D)2
E)0.5

Question

Table 5.6
 $$\begin{array} { | c | c | } 
\hline \text { Quantity Supplied } & \text { Frice } \
\hline 10 & \$ 10 \
\hline 20 & \$ 20 \
\hline 30 & \$ 30 \
\hline 40 & \$ 40 \
\hline 50 & \$ 50 \
\hline
\end{array}$$
-Refer to Table 5.6.If price decreases from $50 to $30,the price elasticity of supply is:
A)10
B)5
C)1
D)2
E)0.5

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, the quantity supplied changes from 50 to 30, and the price changes from $50 to $30. The percentage change in quantity is (30-50)/50 = -0.4, and the percentage change in price is (30-50)/50 = -0.4. Thus, the elasticity is -0.4/-0.4 = 1.

Table 56 -Refer to Table 5