Posted by Anjali Kaur on Sep 16, 2020

# The Price Elasticity of Supply

The price elasticity of supply is a measure of the responsiveness of the quantity supplied to the change in the price of the commodity. It is also defined as the percentage change in quantity supplied of a commodity divided by the percentage change in the price of a commodity. Let’s learn more about it.

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## Formula & Slope of the Curve

### 1. Percentage method of price elasticity of supply

% Change in the quantity supplied = Change in quantity x 100/ Initial quantity

Percentage Change in the price = Change in price x 100/ Initial price

### 3. Slope Formula of Price Elasticity of Supply

Slope of the supply curve = Change in Price/ Change in Quantity supplied

Price Elasticity of Supply = 1/ Slope of the supply curve X P/Q

## Types of Price Elasticity of Supply

There are 5 types of price elasticity of supply:

### 1. Perfectly Elastic Supply Curve

In this case, Price Elasticity of Supply = Infinity.

The supply curve looks like half E, it means the seller will supply the commodity at the fixed price. As shown below:

### 2. Perfectly Inelastic Supply Curve

In this case, Price Elasticity of Supply = 0.

The supply curve looks like I shaped, it means the seller will supply the fixed quantity commodity irrespective of the price. As shown below:

### 3. Unitary Elastic Supply Curve

In this case, Price Elasticity of Supply = 1

The supply curve is perfectly upward sloping, it means the seller will supply the commodity according to the price. The higher the price, the higher will be the quantity supplied. As shown below:

### 4. Elastic or Greater than Unitary Elastic Supply Curve

In this case, Price Elasticity of Supply > 1

The supply curve looks like the perfectly elastic supply curve, but flatter. As shown below:

### 5. Inelastic or Less than Unitary Elastic Supply Curve

In this case, Price Elasticity of Supply < 1

The supply curve looks like the perfectly inelastic supply curve, but steeper. As shown below:

ou can read the related concepts:

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