If a tripling of price triples the quantity of a good supplied, the price elasticity of supply for this good is:
A) 3.
B) 300.
C) 1.
D) −1.
E) −3.

Question

Quizplus · Accepted Answer

The price elasticity of supply is calculated as the percentage change in quantity supplied divided by the percentage change in price. In this case, if the price triples (increases by 200%), and the quantity supplied also triples (increases by 200%), the price elasticity of supply would be 200%/200% = 1. Therefore, the correct answer is C.

If a Tripling of Price Triples the Quantity of a Good