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If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked. 28 April 202128 August 2019 Price elasticity of supply measures the responsiveness of quantity supplied to a change in price.
The price elasticity of supply (PES) is measured by % change in Q.S divided by % change in price.
Inelastic supplyThis means that an increase in price leads to a smaller % change in supply. Therefore PES <1 In this case the PES =
Supply could be inelastic for the following reasons
More on: inelastic supply Examples of goods with inelastic supply
Elastic supplyThis occurs when an increase in price leads to a bigger % increase in supply, therefore PES >1
Supply could be elastic for the following reasons
Examples of goods with elastic supply
Importance of elasticity of supply
Question on the price elasticity of supply equation
Q. If the price increased from £30 to £36, what will be the new Q?
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When price of a commodity rises by 20% and quantity supplied increases by 30% What is price elasticity of supply?Elasticity of supply = 1.5.
When a 10% change in price leads to more than 10% change in quantity demanded we say demand is?perfectly elastic demand
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What does it mean if price elasticity of supply is elastic?A price elasticity supply greater than one means supply is relatively elastic, where the quantity supplied changes by a larger percentage than the price change.
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