Elasticity of supply

Basic explanations

1. ( i ) Perfectly elastic supply In this case, a slight change in price causes infinite change in quantity supplied. The supply curve SS is parallel to X-axis and ES = ∞ as shown in the figure:

2. ii) Perfectly inelastic supply It is a situation where the quantity supplied remains unchanged, whatever be the changes in price. Hence, the supply curve is parallel to Y-axis and Es = 0, as shown in the figure:

3. (iii) Unitary elastic supply- In this case, percentage change in quantity supplied is exactly equal to percentage change in price. Hence, the supply curve is a straight line originating from the origin and sloping upward and Es = 1, as shown in the figure:

4. iv)Elastic supply - In this situation, percentage change in quantity supplied is greater than the percentage change in  price .An  upward sloping straight line supply curve originates from Y-axis and Es = greater than 1 and less than infinity, as shown in the figure:

5. v) Less than unitary elastic supply In this situation, percentage change in quantity supplied is less than percentage change in price. An upward sloping straight line supply curve originates from X-axis and Es is greater than 0 and less than 1, as shown in the figure: