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4. If a
coal mining company would be willing to produce and sell 9 million
tons a year at $150/ton, but would be willing to produce and sell
11 million tons a year at $250/ton,


calculate its price elasticity of supply.

– Is
this supply elastic or inelastic?

– If
the price of coal were to remain at $250/ton over the next ten
years (with no inflation in general prices), is this firm’s supply
curve likely to become more or less elastic?


Explain why.