Evaluate the factors which influence price elasticity of supply with reference to the market for a commodity or raw material.

Price elasticity of supply is a variable of responsiveness and hence, is dependent upon several factors. The first factor is the number of suppliers available for the good or service in the market. The higher the number of suppliers, the higher is the price elasticity of supply. Then comes the inventory size of a supplier. If a supplier has adequate spare capacity, he/she will be able to respond to a change in price with higher volatility. Then comes the length of the production period. The more time the production of a commodity takes, the lower is the price elasticity of supply. Another important factor that can be considered is factor mobility. If factors can be shifted easily from one process to another, the quantity supplied can react aggressively to the change in price. The higher the mobility, the higher the price elasticity of supply.