The market price of bound reports falls by 10%. A document-printing firm responds by reducing the quantity of bound reports it offers for sale each week by 4%.
Which conclusion correctly classifies the firm's supply over this price change?
Supply is price inelastic because quantity supplied changes by a smaller percentage than price.
The elasticity cannot be classified without knowing the original price and weekly quantity.
Supply is price elastic because price changes by a larger percentage than quantity supplied.
Supply has decreased because the firm now offers fewer bound reports each week.
81 exam-style questions on OCR GCSE Economics 2.3 Supply, covering 2.3.1 What is supply, 2.3.2 Draw a supply curve using data, 2.3.3 Explain a supply curve, 2.3.4 Shifts and movements of the supply curve, 2.3.5 Causes and consequences of supply changes, 2.3.6 Price elasticity of supply, 2.3.7 Draw supply curves of different elasticity, and 2.3.8 Importance of price elasticity of supply. Each one has a worked solution and a mark scheme showing where the marks go.