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Question
Explain the percentage method of measuring price elasticity of supply.
Solution
Price elasticity of supply is measured by the ratio of the percentage change in quantity supplied to the percentage change in price of the commodity.
Es = `("Percentage change in quantity supplied of a commodity")/("Percentage change in the price of the commodity")`
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| B. Perfectly Elastic | (ii) Es < 1 |
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| D. Highly Elastic | (iv) Es = infinity |
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