Factors governing elasticity of supply: 1. Nature of the commodity: Durable goods can be stored for a long time. So, the producers can wait until they get a high price. Once they get higher price, larger supply is possible.The elasticity of supply of durable goods is high. But perishables are to be sold immediately. So […]
Tag: What is elasticity of Supply
Elasticity of Supply
Elasticity of Supply: Elasticity of supply may be defined as the degree of responsiveness of change in supply to change in price on the part of sellers. It is mathematically expressed as: Elasticity of supply = proportionate change in supply / proportionate change in price es=(ΔQs/Qs) / (ΔP/P); es= ΔQs / ΔP × P/Qs Where […]