The price elasticity of supply of commodity X and Y are equal. The price of X falls from ₹10 to ₹8 per unit and its quantity supplied falls by 16 per unit. The price of Y rises by 10 per cent. Calculate the precentage increase increase in its supply.

Explanation

PED of X = PED of Y [Given]
`{:("Commodity X","Commodity Y"),("Initial Price [P] = 10 (given)","PED = Y = 1 [As PED of X and Y are equal]"),("New Price "[P_(1)]=8,),(Delta P=-2,),("Percentage change in Price",),(=(Delta P)/(P)xx100=(-2)/(10)xx100=(-)20%,PED=("Percentage change in Quantity demanded")/("Percentage change in Price")),("Percentage change in quantity demanded = 20%",),(PED=("Percentage change in Quantity demanded")/("Percentage change in Price"),1=("Percentage change in Quantity demanded")/(10%)),(=(20%)/((-)20%)=(-)1,"As price of Y increases by 10%, than"),(PED=1,"quantity demanded for y fall by 10%."):}`
Numerical Problem to Calculate Price Elasticity of Demand by Total Expenditure Method.