The price of a commodity is Rs. 5 per unit and its quantity suppled is 600 units. If its price rises to Rs. 6 per unit , its quantity supplied rises by 25 percent. Calculate its price elasticity of supply.

The price of a commodity is Rs. 5 per unit and its quantity suppled is

1.	The price of a commodity is Rs. 5 per unit and its quantity suppled is 600 units. If its price rises to Rs. 6 per unit , its quantity supplied rises by 25 percent. Calculate its price elasticity of supply.
Answer» Solution :`E_(s) =(%"Change in SUPPLY")/(%"change in price")=(25)/((1)/(5)xx100)=(25)/(20)=1.25` Supply is ELASTIC because `E_(s)GT 1`.