Proposition of Elasticity

The proposition of elasticity states that the quantity supplied of a good or service responds to changes in its price. If the price increases, suppliers are generally willing to produce more; if it decreases, they produce less. The degree of this response measures the elasticity. A highly elastic supply means small price changes lead to large changes in quantity supplied, while inelastic supply means quantity changes little regardless of price changes. This concept helps understand how markets adjust to price shifts and informs decisions on production and pricing strategies.