A 20% increase in price led the quantity supplied of phones in a competitive market to increase from 300.00 to 330.00. What is the price elasticity of supply for phones? Give your answer to two decimals.

% change in Price = 20%% change in Quantity supply=Q2 - Q1(Q2 + Q1)/2×100…

Answered: What is the price elasticity of supply…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Question

A 20% increase in price led the quantity supplied of phones in a competitive market to increase from 300.00 to 330.00.

What is the price elasticity of supply for phones? Give your answer to two decimals.

Expert Solution

Step 1

% change in Price = 20%
$% c h a n g e i n Q u a n t i t y s u p p l y = \frac{(Q_{2} - Q_{1})}{(Q_{2} + Q_{1}) / 2} \times 100 = \frac{(330 - 300)}{(330 + 300) / 2} \times 100 = \frac{30}{630 / 2} \times 100 = 9.5 %$

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions