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At the market price of Rs.10, a firm sup...

At the market price of Rs.10, a firm supplied 4 untis of output. The market price increases to Rs.30. The price elasticity of supply is 1.25. What quantity will the firm supply at the new price?

Text Solution

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`{:(" P 10"),(" P"_(1)" 30"),(ulbar(DeltaP" 20")):}" "{:("Q 4"),("Q"_(1)" ?"),(ulbar(DeltaQ" ?")):}`
`P.e_(S)=(P)/(Q)xx(DeltaQ)/(DeltaQ)" or "1.25=(10)/(4)xx(DeltaQ)/(20)`
`1.25xx8=DeltaQ`
`DeltaQ=10.00=10" units"`
`DeltaQ=Q_(1)-Q" or "10=Q_(1)-4`
`10+4=Q_(1)`
`Q_(1)=14` units
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