What is the difference between factors that affect supply and the elasticity of supply?

Factors affecting supply will shift the supply curve in or out. These factors are costs of raw materials, technological advancements, wages. Factors affecting the elasticity of the supply curve will affect the steepness or gradient of the curve. These include, level of spare capacity- the more spare capacity, the more elastic the supply as firms can respond quicker to more changes in demand as they have the flexibility, level of stock- more levels of stock, more elastic the supply curve as firms have the stock to meet increase demand if needed so can respond quickly, time frame so the more time the firms have to respond, the more elastic, ease of switching/ availability of substitutes so if firms can easily change production using their resources then they can respond to changes in demand so the more elastic the supply curve.

JH
Answered by Jennifer H. Economics tutor

2045 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Analyse three consequences of high inflation on individuals in the UK


Could you explain the distribution of the incidence of a tax and why it may fall differently on consumers and producers?


What would be the impact on the multipler effect given an increase in income tax?


Discuss the likely impact of a depreciation of the pound on the UK's economy.


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2025

Terms & Conditions|Privacy Policy
Cookie Preferences