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    Question

    If a 1 percent decrease in the price of a pound of

    squash results in a larger percentage decrease in the quantity supplied,
    A demand is inelastic Correct Answer Incorrect Answer
    B demand is elastic. Correct Answer Incorrect Answer
    C supply is inelastic Correct Answer Incorrect Answer
    D supply is elastic Correct Answer Incorrect Answer

    Solution

    When percentage change in quantity supplied is greater than the percentage change in own price of commodity, supply is said to be elastic.

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