Answer:
12% in the short run and 21 in the long run.
Explanation:
Here us the full question
Suppose the price elasticity of supply for dog biscuits is 0.8 in the short run and 1.4 in the long run. If an increase in the demand for dog biscuits causes the price of dog biscuits to increase by 15%, then the quantity supplied of dog biscuits will increase by about X·
18.8% in the short run and 167% in the long run.
23% in the short run and 29 in the long run.
0.05% in the short run and 009% in the long run.
12% in the short run and 21 in the long run.
Price elasticity of demand measures the responsiveness of quantity supplied to changes in price of the good.
Price elasticity of supply = percentage change in quantity supplied / percentage change in price
In the short run : 0.8 = percentage change in quantity supplied / 0.15
percentage change in quantity supplied = 12%
In the long run : 1.4 = percentage change in quantity supplied / 0.15 =
percentage change in quantity supplied = 21%
