If the Price of a A Good Increases by 10

question 150

Multiple Choice

If the price of a a good increases by 10 percent and the quantity supplied increases by 5 percent,then the elasticity of supply is

• A) greater than one and supply is elastic.
• B) negative and supply is inelastic.
• C) less than one and supply is elastic.
• D) less than one and supply is inelastic.
• E) greater than one and supply is inelastic.

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Definitions:

Profit Change

The difference in profit amounts between two periods, indicating an increase or decrease in profitability.

Unit Profit

The amount of income that derives from selling one unit of a product after deducting the unit cost of producing that product.

Decision Variables

The variables in a mathematical model that decision makers will seek to determine or control.

Optimal Values

The most favorable or efficient values that lead to the best outcome in a given situation or model.