Question

8. When price of a conmodity falls by 10%, its supply decreases from 80 units to 60 units. Calculate the
E,
=2.5)
you​

Answer 1

Answer:

1

Explanation:

Let earlier price of commodity is x and fall is 10% so x/10

ELASTICITY = PRICE/QUANTITY ×CHANGE IN QUANTITY/CHANGE IN PRICE

:. P•◇Q/Q•◇P

=> 2.5 = (X×20)/(80×X/10)

=> 2.5 = 20X/8X

=> 2.5 = 2.5X

=> X = 1.

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