Price Elasticity of Supply Calculator
Calculate how responsive supply is to changes in price
PES = (% Change in Quantity) / (% Change in Price)
Understanding Price Elasticity of Supply
Price elasticity of supply (PES) measures how responsive producers are to price changes. It helps businesses and economists understand market dynamics and make informed decisions.
Interpreting PES Values
- PES > 1: Elastic supply (supply is very responsive to price changes)
- PES = 1: Unit elastic supply
- PES < 1: Inelastic supply (supply is less responsive to price changes)
Factors Affecting Supply Elasticity
- Time period for production adjustments
- Availability of resources
- Storage capacity
- Production flexibility