Assume That a Firm Makes Available 50 More Units of a Good

question 16

Multiple Choice

Assume that a firm makes available 50 more units of a good at a price of $2 than it made available when the price was $1. What is the price elasticity of supply?

• A)It cannot be determined from the information given.
• B)0.25
• C)25
• D)50
• E)0.04

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Definitions:

Investment

The distribution of funds or assets with the intention of earning financial returns or profits.

Interest

Expenses incurred for the authorization to take out a loan, frequently shown as an annual rate in percentage.

Term Deposit

A financial product offered by banks that earns interest and is held for a predetermined period until it reaches the date of maturity.

Simple Interest Rate

An interest rate calculated only on the principal amount, not on previously earned interest.