The price elasticity of supply is used in economics to measure the change in the supply of goods and services with the change in their prices. It shows the extent to which supply of goods and services change with the change in prices. If the change in the supply of goods and services is more than the change in prices, then the good is said to be price elastic. On the other hand, if the change in the supply of goods and services is less than the change in prices, then the good is said to be inelastic.