Holding All Other Factors Constant and Using the Midpoint Method,if

question 56

Multiple Choice

Holding all other factors constant and using the midpoint method,if a tractor manufacturer increases production from 80 to 100 units when price increases by 15 percent,then supply is

• A)inelastic,since the price elasticity of supply is equal to 0.68.
• B)inelastic,since the price elasticity of supply is equal to 1.48.
• C)elastic,since the price elasticity of supply is equal to 0.68.
• D)elastic,since the price elasticity of supply is equal to 1.48.

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Definitions:

General Equilibrium Prices

The set of prices for all goods and services in an economy at which supply and demand across all markets are in balance.

Recreational Activities

Activities undertaken for pleasure, leisure, and relaxation during free time.

Equilibrium Price

The price at which the quantity of goods supplied is equal to the quantity of goods demanded.

Quantity Supplied

The total amount of a good or service that producers are willing and able to sell at a given price within a specific time period.