If the price of coffee falls by 10 percent and the quantity supplied of coffee falls by 1.5 percent, then the elasticity of supply of coffee is:
A)10.
B) 1.5.
C) 0.15.
D) 6.67.

Question

Quizplus · Accepted Answer

Elasticity of supply = (% change in quantity supplied)/ (% change in price)
Given that % change in price = -10%
and % change in quantity supplied = -1.5%
Putting the values in the above formula,
Elasticity of supply = (-1.5)/(-10) = 0.15

If the Price of Coffee Falls by 10 Percent and the Quantity