The coefficient of price-elasticity of supply for a product is 1.2 if
A) a 3 percent decrease in the price causes a 0.4 percent decrease in quantity supplied.
B) a 3 percent decrease in price causes a 1.2 percent decrease in quantity supplied.
C) a 3 percent decrease in price causes a 3.6 percent decrease in quantity supplied.
D) a 1.2 percent decrease in price causes a 1.2 percent decrease in quantity supplied.
Correct Answer:
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