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Elasticity of supply

Definition: [crh] The degree of producers' responsiveness to price changes. Elasticity is measured as the percent change in quantity divided by the percent change in price. A large value (greater than 1) of elasDefinition: ticity indicates sensitivity of supply to price, e.g., luxury goods, where a rise in price causes an increase in supply. Goods with a small value of elasticity (less than 1) have a supply that is insDefinition: ensitive to price, e.g., food, where a rise in price has little or no effect on the amount that producers supply.

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