If the price of a good increases from $200 to $250 and quantity supplied increases from 200 units to 400 units, the supply would be classified as elastic.

Question

Quizplus · Accepted Answer

When the percentage change in quantity supplied is greater than the percentage change in price, the supply is considered elastic. In this scenario, the percentage change in quantity supplied is 100% and the percentage change in price is 25% [(250-200)/200 x 100]. Therefore, the supply is elastic.

If the Price of a Good Increases from $200 to $250