If the Price Elasticity of Supply for a Good Is

question 146

Multiple Choice

If the price elasticity of supply for a good is 0.75,then

• A) the percentage change in the quantity supplied is less than the percentage change in price.
• B) the supply is elastic.
• C) an increase in the price boosts the quantity supplied by a larger percentage.
• D) the supply is inelastic so the demand must also be inelastic.
• E) None of the above answers is correct.

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Definitions:

Standard Price

A pre-determined cost that is often used in budgeting and financial planning, serving as a benchmark for performance evaluation.

Direct Materials

Materials that become an integral part of a finished product and whose costs can be conveniently traced to it.

Final, Delivered Cost

The comprehensive cost of a good or service including its production, logistics, and any other costs until its delivery to the final consumer.

Standard Labor Rate

The predetermined cost of labor per hour used to estimate the total labor costs of a production process or project.