Final answer:
The price elasticity of supply for hamburgers when the price increases from $3 to $4, with an increase in quantity supplied from 100 to 150 units, is 1.5. The closest given option is 1.4, which indicates that the supply is elastic.
Step-by-step explanation:
The student is asking about the price elasticity of supply for hamburgers when the price rises from $3 to $4 and the quantity supplied increases from 100 units to 150 units. To calculate the elasticity, we use the formula:
Price Elasticity of Supply = (% Change in Quantity Supplied) / (% Change in Price)
First, we calculate the percentage change in quantity supplied: (150 - 100) / 100 × 100 = 50%. Next, we calculate the percentage change in price: (4 - 3) / 3 × 100 = 33.33%. Using these values, the price elasticity of supply is 50% / 33.33% = 1.5.
Thus, the price elasticity of supply for hamburgers is 1.5, which means option b. 1.4; elastic is closest to our calculated value, and the supply is considered elastic because the elasticity value is greater than 1.