Unit 2 · Microeconomics · Topic 2.6

IB Economics — Elasticity of supply

PES, time horizons, and responsiveness of supply in different markets.

Key concepts in Elasticity of supply

Key Idea: Topic 2.6 explains how responsive producers are to price changes (PES), what determines it, and why it matters for price volatility in commodity markets.

📐 Price elasticity of supply (PES)

PES = \\frac{\\%\\Delta Q_s}{\\%\\Delta P}

Always positive (direct relationship)

🔑 Determinants of PES

⏱️ Time horizons

📊 PES and market volatility

In diagram questions: inelastic supply = steep curve → demand shift causes a BIG price change. Always link PES to the steepness of the curve.

What you'll learn in Topic 2.6

2.6.1 Price elasticity of supply (PES)
2.6.2 Determinants of PES

Suggested study order: Read the notes for each sub-topic below → test yourself with flashcards → attempt practice questions → review exam technique.

Study resources — 2.6 Elasticity of supply

2.6.1

Price elasticity of supply (PES)

Notes

2.6.2

Determinants of PES

Notes

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Topic 2.6 Elasticity of supply forms a core part of Unit 2: Microeconomics in IB Economics. Mastering these concepts will strengthen your understanding of connected topics across the syllabus and prepare you for exam questions that require analysis, evaluation, and real-world application.

Frequently asked questions

What does Topic 2.6 Elasticity of supply cover in IB Business Management?

Topic 2.6 covers elasticity of supply as part of the IB BM syllabus. Students learn key business concepts, tools, and frameworks that are assessed in Paper 1 (case study) and Paper 2 (structured questions).

How should I revise Elasticity of supply for IB Business Management exams?

Start with the micro-topic notes to build understanding, then use flashcards for key terms and formulas. Practise applying concepts to case study scenarios and review how marks are allocated in IB mark schemes.

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Exam technique

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