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WAEC Economics 2014 Question 35

Question 35

Elasticity

An increase in the price of a commodity from $10 to $15 leads to an increase in the quantity supplied from 10 units to 15 units. The price elasticity of supply is

  1. A.0.
  2. B.0.5.
  3. C.1.
  4. D.5.
Show the answer and explanation

Answer: C (1.)

Explanation

Both quantity and price rise by 50%, so Es = 50 ÷ 50 = 1.