The price elasticity of supply for umbrellas is 2.Suppose you're told that,following a price increase,quantity supplied increased by 30 per cent.What was the percentage change in price that brought this about?
A) 60 per cent
B) 15 per cent
C) 6.7 per cent
D) Impossible to determine without additional information

Question

Quizplus · Accepted Answer

The price elasticity of supply formula is percentage change in quantity supplied divided by percentage change in price. Given elasticity is 2 and quantity change is 30%, the price change is 30% / 2 = 15%.

The Price Elasticity of Supply for Umbrellas Is 2