2. From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply from: point J topoint K, point L to point M, and point N to point P. Classify the elasticity at each point as elastic, inelastic, or unitelastic.PointPriceQuantity Supplied$850K.$970$1080$1188$1295P$13100Table 5.6

1) Price elasticity of supply between J and K:- ES=∆Q∆P×PQ =(Q2-Q1)(P2-P1)×P1Q1…

Answered: 2. From the data in Table 5.6 about…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Chapter1: Making Economics Decisions

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2. From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply from: point J to
point K, point L to point M, and point N to point P. Classify the elasticity at each point as elastic, inelastic, or unit
elastic.
Point
Price
Quantity Supplied
$8
50
K.
$9
70
$10
80
$11
88
$12
95
P
$13
100
Table 5.6

Expert Solution

Step 1

1) Price elasticity of supply between J and K:-

$E_{S} = \frac{∆ Q}{∆ P} \times \frac{P}{Q} = \frac{(Q_{2} - Q_{1})}{(P_{2} - P_{1})} \times \frac{P_{1}}{Q_{1}} = \frac{70 - 50}{9 - 8} \times \frac{8}{50} = \frac{20}{1} \times \frac{8}{50} = 3.2$

Supply is elastic as $E_{S} > 1$

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