Unit 2.6 · Elasticity of Supply
Determinants of PES
AO2
Syllabus Requirement
Factors affecting PES include time period, mobility of factors of production, spare capacity, ability to store output, and rate at which costs rise.
Assessment Objectives
AO2Application and Analysis
Summary
This topic discusses the factors that influence the price elasticity of supply (PES), which measures how responsive the quantity supplied of a good is to changes in its price. Understanding these determinants is important for analyzing how producers react to market conditions and price changes.