The price of a good changes from Rs 20 to Rs 25. As a result, the quantity supplied changes from 500 units to 1000 units. Calculate the price elasticity of supply.

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2.5

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Solution

The correct option is C
4

Price changes from Rs 20 to Rs 25 and qunatity supplied changes from 500 to 1000.
$ϵ_{s} = \frac{q_{1} - q_{0}}{p_{1} - p_{0}} \times \frac{p_{0}}{q_{0}} ϵ_{s} = \frac{1000 - 500}{25 - 20} \times \frac{20}{500} ϵ_{s} = \frac{500 \times 20}{500 \times 5} = 4$

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The price of a good changes from Rs 20 to Rs 25. As a result, the quantity supplied changes from 500 units to 1000 units. Calculate the price elasticity of supply.

The correct option is C 4 Price changes from Rs 20 to Rs 25 and qunatity supplied changes from 500 to 1000. ϵs=q1−q0p1−p0×p0q0ϵs=1000−50025−20×20500ϵs=500×20500×5=4

The correct option is C
4

Price changes from Rs 20 to Rs 25 and qunatity supplied changes from 500 to 1000.
$ϵ_{s} = \frac{q_{1} - q_{0}}{p_{1} - p_{0}} \times \frac{p_{0}}{q_{0}} ϵ_{s} = \frac{1000 - 500}{25 - 20} \times \frac{20}{500} ϵ_{s} = \frac{500 \times 20}{500 \times 5} = 4$