Price Elasticity of Supply
- Created by: Former Member
- Created on: 04-05-15 15:04
View mindmap
- Price Elasticity of Supply.
- A measure of how the quantity supplied of a good responds to a change in price
- Calculated using :
- % change in QS / % change in price
- Answer is generally positive as the higher the price the greater the supply.
- Can be elastic or inelastic.
- If the value is greater than one, it is elastic.
- If PES = 1, quantity supplied is equal to price.
- If the value is between 0 and 1, it is inelastic.
- Perfectly inelastic = value of 0.
Comments
No comments have yet been made