Answer:
Beth's Elasticity of Supply (Midpoint Method) : 10.11 ; Supply : Highly Elastic
Explanation:
By Midpoint method , Elasticity of supply formula is :-
<u>[ Q2 - Q1 ] / [ (Q2 + Q1)/2 ]</u>
[ P2 - P1] / [ (P2 + P1) / 2 ]
Putting the given following values in the formula ; we get :-
P1 = 25 ; P2 = 40 ; Q1 = 4 ; Q2 = 10
<u>[ 40 + 25 ] / [ (40 - 25) / 2] </u>
[ 10 - 4 ] / [ (10 + 4) / 2 ]
<u>65 / 7.5 </u>
6 / 7
8.6 / 0.85
= 10.11
Beth's Elasticity of supply is much higher than one ; So his supply is Highly Elastic.