If the Price of Cocoa Rises by 10 Percent and the Elasticity

question 68

Multiple Choice

If the price of cocoa rises by 10 percent and the elasticity of supply is 0.5, then the quantity supplied:

• A) increases by 5 percent.
• B) increases by 20 percent.
• C) decreases by 5 percent.
• D) decreases by 20 percent.

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Definitions:

Future Date

A specified time in the future, often used in the context of planning, forecasting, or setting deadlines.

Compounded Monthly

A method of calculating interest where the interest is added to the principal amount each month, with each subsequent calculation including the previously accumulated interest.

Interest

The cost associated with the right to borrow funds, often represented as a percentage rate per year.

Compounded Semi-Annually

An approach to calculating interest where the interest is added to the principal twice a year.