Suppose that a 20% increase in the price of product X generates a 15% increase in the quantity of X supplied. The price elasticity of supply for good X is
A. less than 1 and therefore supply is inelastic.
B. positive and therefore X is a normal good.
C. negative and therefore X is an inferior good.
D. more than 1 and therefore supply is elastic.
Answer: A
Economics
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