Elasticity of supply: responsiveness of output to changes in price; computed as the percentage change in the quantity supplied divided by the percentage change in the price. Supply is said to be elastic (inelastic) if the elasticity exceeds (is less than) 1. The more elastic supply is, the more will a change in price increase production.
Elasticity of demand: responsiveness of buyers to changes in price, defined as the percentage change in the quantity demanded divided by the percentage change in price. Demand for luxury items may slow dramatically if prices are raised, because these purchases are not essential and can be postponed.
