Elasticity of Supply and Its Determinants

The supply-side twin

Three time horizons

How a demand shift spreads

Determinants beyond time

When the price of a bushel of wheat rises from 5 to 6 dollars, a 19 percent rise by midpoints, a farm increases output from 1,000 to 1,060 bushels, a 5.8 percent rise by midpoints. What is the supply elasticity and what does it suggest about the time horizon?

A city's demand for apartments rises sharply. In the momentary run the supply of apartments is essentially vertical. Where does the adjustment land immediately?

In the long run a market's supply is much more elastic, with elasticity 2. If price rises by 15 percent, compute the percentage increase in quantity supplied implied by this elasticity and write the number.

Which supply is most elastic for a given product?

City apartment demand rises sharply while the momentary supply of apartments is almost perfectly inelastic. What happens first?

The elasticity of supply is 0.5, and the market price rises by 30 percent. Compute the percentage increase in quantity supplied, and write the number.