Question: The supply function of a certain good is given by: Q = 0,4P 2 + 5P + 120 a. Find the price elasticity of supply

The supply function of a certain good is given by:

Q = 0,4P2+ 5P + 120

a. Find the price elasticity of supply (E) if the current price is 5 (P=5). Is the price unit elastic, elastic, or inelastic?

b. Estimate the percentage change in supply when the price rises by 7% if the current price is 5 units.

c. For what values of P is the supply unit elastic?

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