FIGURE 6 TIME AND PRICE ELASTICITY OF SUPPLY
During the market period, the quantity of output available to the market is fixed and the only impact will be on the price of the product, which will rise from P0 to P1 if demand increases. Over the short run, firms can change the amount of inputs they employ to adjust their output to market changes. Thus, the short-run supply curve (SSR) is more elastic than the market period curve, and price increases are more moderate. In the long run, firms can change their plant capacity and enter or exit an industry. Long-run supply curve SLR is elastic, and a rise in demand leads to a small increase in price.