Unit 2.6 · Elasticity of Supply
Price Elasticity of Supply (PES)
AO2AO4Diagram required
Syllabus Requirement
Measures the responsiveness of quantity supplied to a change in price.
Assessment Objectives
AO2Application and Analysis
AO4Use of Appropriate Skills
Summary
Price elasticity of supply (PES) indicates how much the quantity supplied of a product changes in response to a change in its price. Understanding PES is important in economics because it helps explain how quickly and effectively producers can adjust their output when market prices fluctuate.
