Suppose a 4 Per Cent Increase in Price Results in a 2

question 132

Multiple Choice

Suppose a 4 per cent increase in price results in a 2 per cent increase in the quantity supplied of a good.Calculate the price elasticity of supply and characterise the product.

• A)2; The product is elastic.
• B)0)2; The product is inelastic.
• C)0)5; The product is inelastic.
• D)50%; The product is inelastic.

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Definitions:

Serotonin

A neurotransmitter involved in the regulation of mood, appetite, sleep, memory, and learning.

Norepinephrine

A neurotransmitter and hormone involved in the body's response to stress, also playing a key role in alertness and the fight-or-flight response.

Id

In psychoanalytic theory, the part of the personality that contains our primitive impulses such as sex, anger, and hunger, and operates on the pleasure principle.

Pleasure Principle

A concept in psychoanalytic theory referring to the instinctual seeking of pleasure and avoidance of pain to satisfy biological and psychological needs.