Q.Explain the different degrees of price elasticity of supply.

Price elasticity of supply can range across five recognised degrees depending on its numerical value.

Price elasticity of supply, $E_s = \dfrac{\%\Delta Q_s}{\%\Delta P}$, is classified into five degrees by its numerical value:

1. Perfectly elastic ($E_s = \infty$) — an infinitesimally small rise in price calls forth an infinitely large increase in quantity supplied; the supply curve is a horizontal straight line.
2. Relatively elastic ($E_s > 1$) — quantity supplied changes by a larger percentage than price; geometrically, a straight-line supply curve that cuts the positive PRICE axis.
3. Unitary elastic ($E_s = 1$) — the percentage change in quantity supplied exactly equals the percentage change in price; geometrically, any straight-line supply curve passing through the ORIGIN, whatever its slope. …

Assuming every upward-sloping straight-line supply curve has the SAME elasticity (=1) — this is true ONLY for a line through the origin; a line cutting the price axis is relatively elastic …