Many candidates who attempted this question did well. The candidates scored good marks in the 'a' and 'b' parts of the question as they were able to (i) define elasticity of supply as the degree of responsiveness of the quantity supplied to price change. Or Elasticity of supply =
% change in quantity supplied
% change in price
(ii) Describe elastic supply as when the coefficient of elasticity is greater than one and inelastic when the coefficient is less than one.
However a significant proportion of the candidates lost valuable marks because they failed to outline any two factors that influence elasticity of supply. Such factors are as follows:
How quickly the factors of production can be switched from one type of production to another.
The time required to produce a commodity.
The availability of factors of production.
Perishable and bulky goods tend to be relatively inelastic in supply.
The behaviour of cost of production as output changes.
Ease of entry or exit of producers.
Ease with which products can be switched from one market to the other.
Change in technology.
Nature of the product – industrial or agricultural product