2. AS/Year 1 Microeconomics tutorial AQA A-level Economics © Hodder & Stoughton Limited 2015 Price elasticity of supply

3. AQA A-level Economics Price elasticity of supply(PES) ●PES measures the responsiveness of quantity supplied to a change in price ●Formula: percentage change in quantity supplied percentage change in price AS/Year 1 Microeconomics © Hodder & Stoughton Limited 2015 2

4. AQA A-level Economics Elastic or inelastic? Elastic supply ●If the firm is able to increase supply quickly in response to a change in price, then supply is said to be price elastic in supply Inelastic supply ●If the firm is unable to increase supply quickly in response to a change in price, then supply is said to be price inelastic in supply AS/Year 1 Microeconomics © Hodder & Stoughton Limited 2015 3

5. AQA A-level Economics Factors determining PES ●Time ●Weather conditions ●Ease of access to specialist equipment ●Planning permission and other government restrictions ●Stocks ●Spare capacity AS/Year 1 Microeconomics © Hodder & Stoughton Limited 2015 4

6. AQA A-level Economics Short and long-run supply AS/Year 1 Microeconomics © Hodder & Stoughton Limited 2015 5