If a 40% Change in Price Results in a 25

question 138

Multiple Choice

If a 40% change in price results in a 25% change in quantity supplied,then the price elasticity of supply is

• A) 0.63,and supply is elastic.
• B) 0.63,and supply is inelastic.
• C) 1.60,and supply is elastic.
• D) 1.60,and supply is inelastic.

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Definitions:

Break-Even Point

The point at which total costs and total revenues are equal, meaning no profit or loss occurs.

Bearish

A market sentiment indicating an expectation that stock prices will decline.

Put

An options contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Investment Insurance

A financial product or strategy that provides protection against losses in one's investment portfolio, often through methods such as hedging or insuring a certain value of assets.