#### Question

A producer supplies 100 units of a good at a price of Rs 20 per unit. Price elasticity of supply is 2. At what price will he supply 50 units? Calculate

#### Solution

Given that

Q_{0} = 100 units

P_{0} = Rs 20

P_{1} =Rs 10

Q_{1} = 50 units

As we know that

`E_s=(DeltaQ)/(DeltaP)xxP_0/Q_0`

ΔP = P_{1}-P_{0}

ΔP =P_{1}-20

ΔQ=Q_{1}-Q_{0}

ΔQ= 50 - 100= - 50 units

`2=(-50)/(P_1-20)xx20/100`

P_{1}=Rs 15

Therefore,at aprice of Rs15, the Producer will supply 50 units.

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Solution A Producer Supplies 100 Units of a Good at a Price of Rs 20 per Unit. Price Elasticity of Supply is 2. at What Price Will He Supply 50 Units? Calculate Concept: Concept of Supply.