The price elasticity of supply of a commodity Y is half the price elasticity of supply of commodity X. 16 percent rise in price of X results in 40 percent rise in its supply. If the price of Y falls by 8 percent, calculate the percentage fall in its supply.

The price elasticity of supply of a commodity Y is half the price elas

1.	The price elasticity of supply of a commodity Y is half the price elasticity of supply of commodity X. 16 percent rise in price of X results in 40 percent rise in its supply. If the price of Y falls by 8 percent, calculate the percentage fall in its supply.
Answer» SOLUTION :`E_(s) ` of X `=(40)/(16)=2.5` `THEREFORE ""E_(s)` of Y =`2.5 DIV 2=1.25` `E_(s)` of Y `=(%"change in supply")/(% "change in PRICE")` `1.25=(%"change in supply")/(8)` % change in supply `=8xx1.25=10` percent