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JAMB Economics 2014 Question 14

Question 14

Elasticity

Use the table below to answer the question.
Price (₦) | Quantity supplied
8 | 20
10 | 24
From the table above, calculate the price elasticity of supply.

  1. A.2.00
  2. B.1.25
  3. C.0.50
  4. D.0.80.
Show the answer and explanation

Answer: D (0.80.)

Explanation

% change in quantity = 4/20 × 100 = 20%. % change in price = 2/8 × 100 = 25%. Elasticity = 20/25 = 0.80.