What this calculator does
Price elasticity of supply measures how sharply the quantity producers are willing to sell responds to a change in price. This calculator applies the standard price elasticity of supply formula: the percentage change in quantity supplied divided by the percentage change in price, from an original and a new price and quantity.
It answers the producer-side half of a question most people only meet from the buyer's side. Price elasticity of demand asks how much less buyers want as price rises; supply elasticity asks how much more sellers are willing to bring to market as price rises, and the two figures together are what set a market's equilibrium price and quantity.
The formula
The percentage change in quantity supplied and the percentage change in price are each calculated against their original values. Dividing the first by the second gives the elasticity of supply. Unlike demand, supply elasticity is normally a positive number, since a higher price typically draws out more supply rather than less; only the size of the number decides whether supply is elastic or inelastic.
| Term | Meaning |
|---|---|
| % change in quantity supplied | (new quantity supplied − original quantity supplied) ÷ original quantity supplied × 100. |
| % change in price | (new price − original price) ÷ original price × 100. |
| Elastic supply | The size of the elasticity is greater than 1: quantity supplied changes by a larger percentage than price did. |
| Inelastic supply | The size of the elasticity is less than 1: quantity supplied changes by a smaller percentage than price did. |
| Unit elastic | The size of the elasticity is exactly 1: the percentage change in quantity supplied matches the percentage change in price. |
The inputs explained
| Field | What to enter |
|---|---|
| Original price ($) | The price before the change. |
| New price ($) | The price after the change. Must be different from the original price. |
| Original quantity supplied | The quantity supplied at the original price. |
| New quantity supplied | The quantity supplied at the new price. |
When to use it
Working through the price elasticity of supply formula for an assignment
This is the direct calculation behind the price elasticity of supply formula taught alongside its demand-side counterpart in introductory economics, useful for checking worked examples or homework answers.
Judging how quickly a producer can respond to a price rise
Goods that can be produced quickly from readily available inputs tend to show high supply elasticity, since producers can ramp up output fast when price rises. Goods that need new capacity, land or a long growing season tend to show low supply elasticity, because output cannot expand quickly no matter how attractive the price becomes.
Comparing supply elasticity across different products or time frames
Running the same price and quantity change through this calculator for two different products, or for the same product over a longer versus a shorter time frame, shows where supply can adjust fastest, which matters for forecasting shortages or price spikes.
Worked examples
Every figure in the tables below is produced by this page’s own calculator at build time, so the numbers and the tool always agree. Select any row to load that scenario.
How elasticity of supply changes as the quantity response gets larger
The same 20% price rise, from $10 to $12, against a range of resulting quantities supplied.
| New quantity supplied | Price elasticity of supply | % change in quantity supplied | Classification |
|---|---|---|---|
| 100 | 0.000 | 0.000% | Inelastic: quantity supplied responds less than proportionally to price |
| 110 | 0.500 | 10.0% | Inelastic: quantity supplied responds less than proportionally to price |
| 120 | 1.000 | 20.0% | Unit elastic: quantity supplied responds exactly proportionally to price |
| 140 | 2.000 | 40.0% | Elastic: quantity supplied responds more than proportionally to price |
| 160 | 3.000 | 60.0% | Elastic: quantity supplied responds more than proportionally to price |
Questions
Why is price elasticity of supply usually a positive number?
Because price and quantity supplied normally move in the same direction: when price rises, producers are usually willing to supply more, and when price falls, they usually supply less. This is the opposite pattern from price elasticity of demand, which is normally negative because price and quantity demanded move in opposite directions.
What does an elasticity of exactly 1 mean?
It means supply is unit elastic: the percentage change in quantity supplied exactly matches the percentage change in price. This is a useful reference case, the same way unit elastic demand is on the buyer's side.
What makes supply inelastic in the short run?
Anything that limits how quickly output can expand: goods that take time to grow or manufacture, limited factory capacity, specialised labour that cannot be hired instantly, or fixed land. Agricultural goods and housing are classic examples of supply that stays inelastic over short time frames even when demand and price move sharply.
How is this different from the price elasticity of demand calculator on this site?
The formula has the same structure, percentage change in quantity divided by percentage change in price, but this calculator measures how much more or less producers are willing to supply as price changes, while price elasticity of demand measures how much more or less buyers are willing to purchase. Both feed into the price elasticity of supply and demand ideas that together set a market's equilibrium.
For the buyer's side of the same formula, see the price elasticity of demand calculator. For how quantity demanded responds to income rather than price, see the income elasticity of demand calculator.