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प्रश्न
How is elasticity of supply measured according to the percentage method?
How is the price elasticity of supply measured?
How can Elasticity of supply be measured?
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उत्तर
According to the percentage method, elasticity of supply (Es) is the ratio between the percentage change in quantity supplied and the percentage change in price of the commodity. In fact, this method originated from the definition of price elasticity of supply itself.
Price elasticity of supply = `("Percentage change in quantity supplied")/("Percentage change in its Price")`
Percentage Change in quantity supplied = `"(ΔQ)"/"Q"xx100`
Percentage change in price = `"(ΔP)"/"P"xx100`
Now the percentage formula can be written as
Es= `((ΔQ)/Qxx100)/((ΔP)/Pxx100)`
Cancelling out 100 by 100, we get
Es = `((ΔQ)/Q)/((ΔP)/P)`
When Q = initial quantity
P Initial price
ΔQ = Change in quantity supplied
ΔP = Change in price of the commodity
Notes
Students should refer to the answer according to the question.
APPEARS IN
संबंधित प्रश्न
Explain any three factors affecting elasticity of supply.
What is the degree of elasticity of supply in the diagram?
Which of the following measures of price elasticity shows elasticity shows elastic supply?
Choose the correct term for the given definition.
The ratio between the percentage change in supply to a percentage change in price.
Which of the following statements are true?
The cost of production will increase if
- The government gives subsidies
- The firm uses obsolete technology
- The price of diesel increases
Pick the option which does not belong to the group.
When is the supply of a commodity is called elastic?
Draw a straight line supply showing elasticity greater than one.
If the price of a commodity increases by 50% and its supply increases by 25% then calculate the price elasticity of supply following the percentage method. Identify the degree of price elasticity.
Explain any four determinants of elasticity of supply.
Give the meaning of perfectly elastic supply.
Draw the supply curve showing price elasticity of supply equal to one.
Identify and define the degree of price elasticity of supply from the diagram for the supply curves S1, S2, S3, S4.
Using graphs, explain any four types of elasticity of supply.
Why does the measure of pnce elasticity of supply of a good carry plus sign?
Price elasticity of supply of a good is 0.8. Is the supply 'elastic' or 'inelastic', and why?
Draw relatively inelastic supply.
Draw relatively elastic supply.
With the help of a suitable diagram, explain the following degree of elasticity of supply.
Es > 1
