Question

Give an example of a good that has elastic supply. What is the value of the price elasticity if supply is elastic? Give example of a good that has inelastic supply. What is the vaule of the price elasticity if supply is inelastic?

Answer #1

Durable goods or manufactured goods generally has elastic supply.

So,

**Furniture is an example of a
good that has elastic supply.**

**The value of price
elasticity of supply would be greater than 1 if supply is
elastic.**

Perishable commodities or commodities whose production depends on natural factors such as weather, rain etc. generally has inelastic supply.

So,

**Wheat is an example of a
good that has inelastic supply.**

**The value of price
elasticity of supply would be less than 1 if supply is
inelastic.**

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