JAMB Economics 2009 Objective — Question 13

Question 13 of 50 from the Joint Admissions and Matriculation Board (JAMB) Economics 2009 Objective paper, with the correct answer and a full explanation.

If the price of an item changes by 8% and quantity supplied changes from 600 units to 660 units, the price elasticity of supply is

A. 0.80
B. 1.25Correct
C. 2.00
D. 1000

Explanation

%change in quantity = (660-600)/600 x 100 = 10%. Elasticity = %change in quantity / %change in price = 10%/8% = 1.25.

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