Micro 3.5 0.0 / 5 ? EconomicsPrice Elasticity of SupplyA2/A-levelAQA Created by: neve.whinnCreated on: 12-03-20 21:52 What is PES? The responsiveness of the quantity supplied of a good or service to a change in price. 1 of 21 How is PES calculated? Percentage change in quantity supplied / percentage change in price. 2 of 21 What is the value of PES with price inelastic supply? Between 0 and 1. 3 of 21 What does price inelastic supply mean? The change in price has led to a smaller percentage change in quantity supplied. 4 of 21 How does the supply curve look with price inelastic supply? Relatively steep. 5 of 21 What is the value of PES with price elastic supply? Greater than 1. 6 of 21 What does price elastic supply mean? The change in price has led to a greater percentage increase in quantity supplied. 7 of 21 How does the supply curve look with price elastic supply? Relatively shallow. 8 of 21 What is the value of PES with unitary elastic supply? 1. 9 of 21 What does unitary elastic supply mean? The change in price has led to the same percentage change in quantity supplied. 10 of 21 How does the supply curve look with unitary elastic supply? A straight line drawn through the origin. 11 of 21 What is the value of PES with perfectly inelastic supply? 0. 12 of 21 What does perfectly inelastic supply mean? The change in price has led to no change in the quantity supplied. 13 of 21 How does the supply curve look with perfectly inelastic supply? Vertical. 14 of 21 What is the value of PES with perfectly elastic supply? Infinity. 15 of 21 How does the supply curve look with perfectly elastic supply? Horizontal. 16 of 21 What are 4 examples of things that affect PES? Time taken to expand supply, size of spare capacity, available stocks, and ease of switching production. 17 of 21 How does time taken to expand supply affect PES? Time consuming = price inelastic. 18 of 21 How does size of spare capacity affect PES? More spare capacity = price elastic. 19 of 21 How do available stocks affect PES? More available stocks = price elastic. 20 of 21 How does ease of switching production affect PES? More ease = price elastic. 21 of 21
AQA Unit 3 Economics: Business Economics and the Distribution of Income 5.0 / 5 based on 1 rating Teacher recommended
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