Suppose That Price Elasticity of the Long-Run Supply of Restaurant

question 12

Multiple Choice

Suppose that price elasticity of the long-run supply of restaurant meals is 2.5. If the price of meals increases by 5%, how would that affect the supply?

• A) Increase by 12.5%.
• B) Decrease by 12.5%.
• C) Increase by 2.5%.
• D) Decrease by 2.5%.

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