Question

A firm supplies 200 units @₹5 per unit when the price changes,it supplies 100 units ES=2.5

Answer 1

Answer:

Given Q=50units;Q1=35units;

ΔQ=Q1−Q=(35−50)=(−)15units

P=Rs.8;Es=1.6

Price elasticity of supply Es=QP×ΔPΔQ

1.6=508×ΔP−15

1.6=50ΔP−120

ΔP=50×1.6−120=−1.5

New price =Rs.8−Rs.1.5=Rs.6.5

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