JAMB Economics 2015 Paper

Concept:Price elasticity of supply measures how responsive quantity supplied is to a change in price.Explanation:Calculate the percentage change in quantity supplied.Change in quantity supplied $= 30 - 20 = 10$ units.Percentage change in quantity supplied $= \frac{10}{20} \times 100 = 50\%$.Calculate the percentage change in price.Change in price $= N5 - N4 = N1$.Percentage change in price $= \frac{1}{4} \times 100 = 25\%$.Use the elasticity of supply formula:Elasticity of supply $= \frac{\text{Percentage change in quantity supplied}}{\text{Percentage change in price}}$.Elasticity of supply $= \frac{50\%}{25\%} = 2$.Answer:The elasticity of supply is $2$.