Price Elasticity Of Supply Flashcards
(4 cards)
1
Q
What does PES measure?
A
PES measures the responsiveness of quantity supplied to the change in price
2
Q
Factors influencing Price elasticity of Supply
A
Productivity, Spare capacity stock, Substantiality of factors of production and time. (PSST)
3
Q
Availibility of vators of productionn
A
If factors of production are available then supply is elastic if not supply is inelastic
4
Q
State of the economy
A
If the economy is in a recession meaning there;s more unemployment it means for a firm quantity supplied could increase as they could hire more people. Vice versa if there was a boom.
