If the price of a product falls by 15% and the quantity supplied falls by 25%, we can assume that the elasticity of supply is inelastic.

Question

Quizplus · Accepted Answer

The elasticity of supply measures how much the quantity supplied responds to a price change. If the quantity supplied falls by a larger percentage (25%) than the price falls (15%), it indicates that the supply is elastic, not inelastic, because the quantity supplied is highly responsive to price changes.

If the Price of a Product Falls by 15% and the Quantity