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Elasticity of supply and time period
Elasticity of supply changes with changing time
1. In the market period the elasticity of supply is zero. The period of time is
so short that the industry does not have any time to change the supply for
any change in the price.
The market period is in turn defined as the shortest time period where the
supply is perfectly in elastic.
2. In the short run the supply becomes relatively elastic. The industry gets
time to make changes in the variable factors of production and change
production in a limited range.
3. Long run is that time period where the industry has enough time to change
the fixed factors as well and bring large changes in the out put.
The supply will be highly elastic in the long run.
Elasticity of supply changes with changing time
1. In the market period the elasticity of supply is zero. The period of time is
so short that the industry does not have any time to change the supply for
any change in the price.
The market period is in turn defined as the shortest time period where the
supply is perfectly in elastic.
2. In the short run the supply becomes relatively elastic. The industry gets
time to make changes in the variable factors of production and change
production in a limited range.
3. Long run is that time period where the industry has enough time to change
the fixed factors as well and bring large changes in the out put.
The supply will be highly elastic in the long run.