A firm supplies 50 units of a commodity at Rs 4 per unit. When the price rises to Rs 6, the firm increased its supply to 75 units. What will be the price elasticity of supply?
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p1=4
q1=50
p2=6
q2=75
change in price=2
change in quantity= 25
%age change in price= 2/4 *100
=50%
%age change in quantity= 25/50*100= 50%
price elasticity of supply= %age change in quantity/ %age change in price
=50/50
=1
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