Q.The price of a commodity rises from ₹10 to ₹12 per unit, and as a result the quantity supplied rises from 100 units to 130 units per week. Calculate the price elasticity of supply by the percentage method and state its degree.

Price elasticity of supply measures how responsive quantity supplied is to a change in the commodity's own price: $E_s = \frac{\%\Delta Q_s}{\%\Delta P}$, normally positive since price and quantity supplied move together. Supply ranges from perfectly elastic ($E_s=\infty$, a horizontal supply curve) to perfectly inelastic ($E_s=0$, a vertical supply curve), with unitary ($E_s=1$), relatively elastic ($E_s>1$) and relatively inelastic ($E_s<1$) in between. It is measured by the percentage method (ratio of percentage changes) and the point/geometric method, under which a straight-line supply curve is relatively elastic if it cuts the price axis, relatively inelastic if it cuts the quantity axis, and exactly unitary elastic at every point if it passes through the origin. Elasticity of supply is shaped mainly by the time period allowed for adjustment (market period, short run, long run), the nature of the commodity (perishable vs. storable), ease of expanding output, availability of inputs, number of producers, gestation period, and government policy — this is one of the most exam-important topics in the MSBSHSE Std XII Economics (Commerce stream) curriculum.