Currently at a price of $1 each, 100 popsicles are sold per day in the perpetually hot town of Rostin. Consider the elasticity of supply. In the short run, a price increase from $1 to $2 is unit-elastic (Es=1.0). In the long run, a price increase from $1 to $2 has an elasticity supply of 1.50. So how many popsicles will be sold per day in the long run if the price rises to $2 each?

Currently at a price of $1 each, 100 popsicles are sold per day in the perpetually hot town of Rostin. Consider the elasticity of supply. In the short run, a price increase from $1 to $2 is unit-elastic (Es=1.0). In the long run, a price increase from $1 to $2 has an elasticity supply of 1.50. So how many popsicles will be sold per day in the long run if the price rises to $2 each?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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