PES

PES

1. measures the change in quantity supplied due to % change in the price of good

2. PES is positive in supple

3. % change in supple / % change in price

4. spare capacity

   • more capacity the easier it is to increase output. supply is elastic

5. length of production

   • the quicker a good is to produce the easier it is to respond to a change in price

6. time period

   • the short time period, more difficult to switch products