1 Do not copy from internet or chegg be original otherwise i will downvote... How do the price elasticities of demand and supply relate to each other ? If we talk in simple terms the elasticity is the degree of responsiveness of one variable with respect to another variable . Elasticity of demand is the percentage change in quantity demanded with respect to percentage change in price . Elasticity of supply is the percentage change in quantity supplied to the percentage change in the price . So if we talk about how the elasticities of demand and supply both relate to each other it is that both of them tell about the responsiveness of demand and supply with respect to price . Demand is from the consumer perspective and supply is from the producer perspective . Both of them have different types of elasticity for example elastic , non - elastic , perfectly elastic perfectly inelastic . Price elasticity of demand states the change in the quantity demanded relative to a change in price for a good or service . In order to know the relationship between the prices of a good influences its demand it is important to understand the concept of price elasticity of demand The price elasticity of demand for a good depends on the nature of the good and the availability of close substitutes . That is , ( for example ) necessity goods like " salt " are essential for life and the demand for such goods do not change to the change in their prices . On the other hand , demand for luxury goods like can be change to the change in price . So demand for a necessity is likely to be price inelastic where as demand for a luxury good is likely to be price elastic . Price elasticity of demand is the percentage change in quantity demanded divided by the percentage change in price . The price elasticity of supply is the percentage change in the quantity supplied to the percentage in price . There are numerous factors like stock , time period , availability of substitutes etc. directly affect the elasticity of supply for a good . These factors will determine whether the price elasticity of supply is elastic or inelastic in regards to a change in price .j