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Price elasticity of supply (PES).pptx
- 1. Price elasticity of supply(PES) By v.sathyajith
- 2. WHAT IS PES ameasure used in economics to show the responsiveness, or elasticity, of the quantity supplied of a good or service to a change in its price or cost.
- 3. TYPES OF PES PERFECTLYELASTIC SUPPLY PERFECTLY INELASTIC SUPPLY ELASTIC SUPPLY INELASTIC SUPPLY UNITARY ELASTIC SUPPLY
- 4. PERFECTLY INELASTIC SUPPLY ISWHEN QUANTITY SUPPLIED DOES NOT ALTER WITH PRICE CHANGES AND PES IS ZERO 0.
- 5. ELASTIC SUPPLY SUPPLY ISELASTIC WHEN A SMALL CHANGE IN PRICE RESULTS IN A GREATER PROPORTIONATE CHANGE IN QUANTITY SUPPLIED AND PES>1
- 6. PERFECTLY ELASTIC SUPPLY ISWHEN A CHANGE IN PRICE WILL CAUSE AN INFINITE CHANGE IN SUPPLY GIVING A PES OF INFINITY.
- 7. INELASTIC SUPPLY A GREATERCHANGE IN PRICE MAY RESULT IN A LESS PROPOTIANE CHANGE IN QUANTITY SUPPLIED
- 8. UNITARY ELASTIC SUPPLY THEELASTICITY OF SUPPLY IN UINTARY, WHEN THE SUPPLY CHANGES IN THE EXACT PROPORTION OF THE CHANGE IN PRICE, IT IS SAID TO BE UNITARY ELASTIC. IT IS ALSO EXPRESSED AS PES=1
- 9. WHAT ARE THEFACTORS AFFECTING PES TIME SUPPLY OF RESOURCES COST OF PRODUCTION NATURE OF THE PRODUCT
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- 11. QUESTION TIME CHARLIE ISA RICE PRODUCER.HIS SUPPLY OF RICE INCREASED FROM 100 UNITS TO 130 UNITS AS A RESULT OF THE INCREASED PRICE FROM $10 TO $12. IN THIS CASE, WE NEED TO FIND OUT THE PERCENTAGE CHANGE IN SUPPLY FIRST.