Apply the midpoints approach to the elasticity of supply

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Currently at a price of $1.00 each 100 popcicles are sold per day in the perpetually hot town of Rostin. Consider the elasticity of supply. In the short run a price increase from $1 to $2 is a unit -elastic (Es =1.0) So how many popsicles will be sold each day in the short run if the price rises to $2 each. In the long run, a price increase from $1 to $2 has an elasticity of supply of $1.50. So how many popsicles will be sold per day in the long run if the price rises to $2 each? (Hint apply the midpoints approach to the elasticity of supply)

Reference no: EM13241618

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