Question #320946
Elaborate the term Elasticity of Supply and explain any three factors that determines
elasticity of supply
Expert's answer
The elasticity of supply measures the responsiveness to the supply of goods or services after a given change in the market price.
Factors affecting elasticity of supply.
Technology innovation. A more efficient production lowers costs and allows larger production of output at a minimum price.
Availability of resources. Required inputs should be readily available to step up production when demand increases.
Flexibility. Efficient producers can respond more quickly to increased demand.
