Answer to Question #318052 in Microeconomics for Asivhothe Hope

Question

A rise in the price of coffee milkshakes from R6 to R10 results in an increase in quantity supplied from 6 000 to 12 000 units. This means that the arc price elasticity of supply for coffee milkshakes is.

Answer 1

Answer.

That implies that the arc is 1.33, The calculation of arc elasticity is considered by getting the midpoint between two points.Arc elasticity is useful for large changes in price thereby giving same elasticity outcomes irregardless of whether the prices falls or rises.