Economics

Types of Elasticity of Supply

There are five types of elasticity of supply:

1. Relatively elastic supply: (see
Diagram 3.13)

The co-efficient of elastic supply is greater than 1(Es > 1). One percent change in the price of a commodity causes more than one per cent change in the quantity supplied of the commodity.

2. Unitary elastic supply:
The coefficient of elastic supply is equal to 1 (Es = 1). One percent change in the price of a commodity causes an equal ( one per cent) change in the quantity supplied of the commodity.

3. Relatively inelastic supply:
The coefficient of elasticity is less than one (Es < 1). One percent change in the price of a commodity causes a less than one per cent change in the aquantity supplied of the commodity.

4. Perfectly inelastic supply:
The coefficient of elasticity is equal to zero (Es = 0). One percent change in the price of a commodity causes no change in the quantity supplied of the commodity.

5. Perfectly elastic supply:
The coefficient of elasticity of supply is infinity. (Es = D ). One percent change in the price of a commodity causes an infinite change in the quantity supplied of the commodity.

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