If the price of hamburger meat increases by 20 percent and the quantity supplied by meat packing companies increases by 30 percent, what is the price elasticity of supply?
A) 1.65
B) 1.20
C) 0.67
D) 1.50

Question

Quizplus · Accepted Answer

Price elasticity of supply is calculated as the percentage change in quantity supplied divided by the percentage change in price. Here, it is 30% / 20% = 1.50.

If the Price of Hamburger Meat Increases by 20 Percent