37. Suppose that the price elasticity of supply is 1 and the quantity supplied increases by 5%. Other things being equal, the percentage change in the price should be: A. a 0.5% increase in the price. B. a 5% increase in the price. C. a 0.2% increase in the price. D. a 2% increase in the price.
Added by Loran L.
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The price elasticity of supply measures how much the quantity supplied of a good responds to a change in the price of that good. It is calculated as the percentage change in quantity supplied divided by the percentage change in price. Show more…
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