Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.
Trending News
Question about elasticity in Micro Economics?
100. An increase in the price of golf clubs from $75 to $125 led to an increase in quantity supplied from 200 units to 300 units. The price elasticity of supply for golf club is _____ so the supply curve is _______.
A. greater than 1; elastic
B. greater than 1; inelastic
C. less than 1; elastic
D. less than 1; inelastic
The answer is D, but i'm having trouble figuring out why, any help would be appreciated.
2 Answers
- Anonymous1 decade agoFavorite Answer
The price increase=(125-75)/75x100=66.7%
The quantity supplied increase= (300-200)/200x100=50%
The price elasticity of supply=50/66.7=0.75,inelastic.
The answer is D.
Source(s): Anjaree - 1 decade ago
If elasticity is greater than or equal to one, the curve is considered to be elastic. If it is less than one, the curve is said to be inelastic.
Elasticity = (% change in quantity / % change in price)
(300-200)/(125-75) that's 3/4 which is LESS than ONE, thus it is inelastic.
Did that make sense? =D
Source(s): Received an A in Micro Economics.
