Price Elasticity of Supply

HideShow resource information
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.


No comments have yet been made

Similar Economics resources:

See all Economics resources »See all Competitive markets resources »