Principles of Microeconomics / Unit 4 MIC 0318 short lesson, about 20 seconds
Time and the Elasticity of Supply
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The idea
Supply is more elastic the longer the period. In months, sellers can only work existing capacity harder; in years they can build, convert and enter.
In practice
A rent rise adds a few attic flats this year and whole buildings in five.
Where people slip
A demand shift that meets short-run supply moves the price sharply. The same shift against long-run supply moves quantity instead.
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