Archive | Price Elasticity of Supply

This article provides an overview on the price elasticity of supply. Meaning of Price Elasticity of Supply: Like price elasticity of demand, price elasticity of supply is a measure of responsive­ness — a measure of the market sensitivity of supply. Price elasticity of supply can be defined as the degree of responsiveness of the quantity supplied of a commodity to [...]

The following nine points highlight the nine factors affecting price elasticity of supply. Factor # 1. The Nature of the Industry: The most important factor affecting price elasticity of supply in the nature of the industry under consideration. This will indicate the extent to which production can be increased in response to an increase in the price of the product. [...]