If the Price of Corn Increases by 20 Percent and the Quantity

question 295

Multiple Choice

If the price of corn increases by 20 percent and the quantity supplied of corn increases by 30 percent,then supply is

• A) elastic and the elasticity of supply equals 1.5.
• B) inelastic and the elasticity of supply equals 1.5.
• C) elastic and the elasticity of supply equals 0.66.
• D) inelastic and the elasticity of supply equals 0.66.
• E) either elastic or inelastic, but more information about the elasticity of demand is needed to determine which.

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Definitions:

Functional Competition

Refers to competition among businesses that offer different goods or services that meet the same customer need or desire.

Direct Competition

Businesses or products that target the same customers and satisfy the same needs.

Lateral Competition

Competition between companies that offer the same or similar goods or services within the same industry.

Sociocultural

The combination of social and cultural factors that affect individual development.