An Increase in the Price of Hamburger from $3 to $4

question 85

Multiple Choice

An increase in the price of hamburger from $3 to $4 leads to an increase in quantity supplied from 100 units to 150 units.At the original price,the price elasticity of supply for hamburgers is _____ and at this point the supply curve is _______.

• A)2/3;elastic
• B)2/3;inelastic
• C)3/2;elastic
• D)3/2;inelastic

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Definitions:

Total Revenue

The overall amount of money generated by a firm from its business activities, typically from the sale of goods and services before any costs are subtracted.

Midpoint Formula

A mathematical method used to calculate the elasticity of demand or supply, measuring the percentage change in quantity relative to a percentage change in price.

Unit Elastic

A situation in which the percentage change in quantity demanded or supplied is exactly equal to the percentage change in price.

Total Revenue

The total revenue produced from the sales of products or services that are central to a company's main business activities.