JAMB Economics 2011 Objective — Question 18
Question 18 of 49 from the Joint Admissions and Matriculation Board (JAMB) Economics 2011 Objective paper, with the correct answer and a full explanation.
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If a firm is faced with an elastic supply curve, its revenue will
- A. A. double at a higher price
- B. B. increase by more than the percentage increase in priceCorrect
- C. C. equal percentage change in price
- D. D. he supplies at a higher price
Explanation
An elastic supply means that the percentage change in quantity is greater than the percentage change in price, so revenue increases by more than the percentage increase in price.
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