Elasticity of supply Flashcards
1
Q
Elastic supply
A
Where the coefficient of price elasticity of supply is greater than +1.
2
Q
Elasticity of supply
A
Price elasticity of supply measures the relationship between change in quantity supplied and a change in market price.
3
Q
Inelastic supply
A
When the coefficient of price elasticity of supply is less than +1. (Pes<1)
4
Q
Price elasticity of supply
A
Price elasticity of supply (PES) measures the relationship between change in quantity supplied and a change in price. Supply responds positively to price, so PES is positive.
