The price elasticity of supply is equal to
A)the value of the slope of the supply curve.
B)the change in quantity supplied divided by the change in price.
C)the percentage change in price divided by the percentage change in quantity supplied.
D)the percentage change in quantity supplied divided by the percentage change in price.

Question

Quizplus · Accepted Answer

The price elasticity of supply is measured as the percentage change in quantity supplied divided by the percentage change in price. This formula helps in determining how responsive the quantity supplied is to the change in price. Choice A is incorrect because the slope of the supply curve indicates the marginal cost of producing an additional unit. However, it is not related to the elasticity of supply. Choice B is incorrect because it measures the slope of the supply curve, which is the same as the elasticity in the case of a linear supply curve only. Choice C is incorrect because it measures the elasticity of demand instead of elasticity of supply.

The Price Elasticity of Supply Is Equal to