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Part 1
Consider the market for a natural​ resource, where the price is initially ​$8 comma 000 per ton and 16 comma 000 thousand tons are supplied.
Part 2
Suppose the price of the resource falls to ​$6 comma 000 per​ ton, at which price the market supplies 15 comma 500 thousand tons.
Part 3
What is the price elasticity of supplyLOADING... between these​ prices?
Part 4
Using the midpoint​ formula, the price elasticity of supply is 
  
enter your response here. ​(Enter your response as a real number rounded to two decimal​ places.)

To calculate the price elasticity of supply (PES), we use the midpoint formula. The formula for price elasticity of supply is:

\[
\text{PES} = \frac{\left( \frac{\Delta Q}{Q_{\text{avg}}} \right)}{\left( \frac{\Delta P}{P_{\text{avg}}} \right)}
\]

where:
- $\Delta Q$ is the change in quantity supplied,
- $\Delta P$ is the change in price,
- $Q_{\text{avg}}$ is the average of the initial and final quantities,
- $P_{\text{avg}}$ is the average of the initial and final prices.

### Step 1: Identify the data
- Initial price ($P_1$) = \$8,000 per ton
- Final price ($P_2$) = \$6,000 per ton
- Initial quantity supplied ($Q_1$) = 16,000 thousand tons
- Final quantity supplied ($Q_2$) = 15,500 thousand tons

### Step 2: Calculate changes in price and quantity
- $\Delta P = P_2 - P_1 = 6,000 - 8,000 = -2,000$
- $\Delta Q = Q_2 - Q_1 = 15,500 - 16,000 = -500$

### Step 3: Calculate the average price and average quantity
- $P_{\text{avg}} = \frac{P_1 + P_2}{2} = \frac{8,000 + 6,000}{2} = 7,000$
- $Q_{\text{avg}} = \frac{Q_1 + Q_2}{2} = \frac{16,000 + 15,500}{2} = 15,750$

### Step 4: Plug values into the midpoint formula
\[
\text{PES} = \frac{\left( \frac{-500}{15,750} \right)}{\left( \frac{-2,000}{7,000} \right)}
\]
\[
\text{PES} = \frac{-0.0317}{-0.2857} = 0.1111
\]

### Step 5: Round to two decimal places
The price elasticity of supply is approximately **0.11**.

Would you like more details or have any questions?

Here are 5 related questions for further practice:
1. What does a price elasticity of supply less than 1 imply about the resource's supply elasticity?
2. How would the elasticity change if the quantity supplied had decreased by 1,000 thousand tons instead of 500?
3. How does the midpoint formula differ from the basic elasticity formula?
4. What happens to the elasticity if the price changes more drastically?
5. Why is elasticity important in understanding market behavior?

**Tip:** Price elasticity of supply measures how responsive the quantity supplied is to a change in price. Elasticities less than 1 are considered inelastic.

Consider the market for a natural resource, where the price is initially $8,000 per ton and 16,000 thousand tons are supplied. Suppose the price of the resource falls to $6,000 per ton, at which price the market supplies 15,500 thousand tons. What is the price elasticity of supply between these prices? Using the midpoint formula, the price elasticity of supply is __________. (Enter your response as a real number rounded to two decimal places.)

Learn how to calculate the price elasticity of supply in the market for a natural resource when the price changes from $8,000 to $6,000 per ton, and the quantity supplied changes from 16,000 to 15,500 thousand tons. This problem covers key concepts in economics, including the midpoint formula for elasticity, suitable for Grades 11-12 and college-level students.

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