between major cities in a large country. A supply schedule is a table which shows how much one or more firms will be willing to supply at particular prices under the existing circumstances. Availability of Substitute Goods 3. Factors determining elasticity of supply: Elasticity of supply is determined by the following factors: 1. There are plenty of factors affecting elasticity of demand including climate of the area. Determinants / Factors affecting Elasticity of Supply: 1. For example, a small change in price of AC may affect its demand to a considerable extent/whereas, large change in price of salt may not affect its demand. If the price of a cappuccino increases by 10%, and the supply … Other factors that effect elasticity of demand include supply and group of people buying. However, the price elasticity differs for different products as it depends on various factors.

Determinants/Factors of Price Elasticity of Supply: The main determinants/factors which determine the degree of price elasticity of supply are as under: (i) Time period. If producers have enough time and resources to expand the level of supply of commodity when price rises, the supply will be elastic and vice versa. Supply schedule. The factors are: 1. Some of the major factors affecting the elasticity of demand of a commodity are as follows: A change in price does not always lead to the same proportionate change in demand.

If it intersects OX axis, elasticity of supply will be less than one. The number of close substitutes – the more close substitutes there are in the market, the more elastic is demand because consumers find it easy to switch.E.g. Nature of the Good 2. Factors affecting price elasticity of demand.

The price elasticity of supply (PES) is measured by % change in Q.S divided by % change in price. If this tangential line intersects OY axis, elasticity of supply will be more than one. Air travel and train travel are weak substitutes for inter-continental flights but closer substitutes for journeys of around 200-400km e.g. Several factors come in to play, affecting demand and supply in various positive and negative ways. Other factors that effect elasticity of demand include supply and group of people buying. The questions on this quiz and worksheet provide you with an easy way to test yourself on the factors that affect the elasticity of supply. As discussed earlier, the price elasticity of demand of a product reflects the change in the quantity demanded as a result of a change in price. Time is the most significant factor which affects the elasticity of supply. The price elasticity of supply (PES) is the measure of the responsiveness in quantity supplied (QS) to a change in price for a specific good (% Change QS / % Change in Price). Factors Affecting the Price Elasticity of Demand | Economics The following points highlight the seven main factors affecting the price elasticity of demand. Load More