ELASTICITY OF SUPPLY AS A DETERMINANT OF DISTRIBUTION 83 
increases from 50.0 to 50.5 units per hour and the number of 
man hours offered from 1000 to 1010, then 
1010—1000 10 ’ 
1600 
50.5—50.0 
50.0 
50.0 100 
This then is unit elasticity where a change of one percent in 
price is accompanied by a change of one percent of quantity 
offered. If the quantity decreased by one percent as the price 
increased by one percent, it would be unit negative elasticity. 
If however the number of man hours were only to increase 
to 1005, then the elasticity would be 
5 L 
1000 
100.0 
5 
500 100 
while if the supply of labor increased to 1020, then 
20 2 
31700 
nn 
) 
500 100 
There is indeed but one important difference between the meas- 
urement of supply schedules and those of demand. By far the 
major portion of all demand schedules are negatively inclined. 
Unit elasticity here is identical with a constant outlay, the change 
in price being commensurate with an opposite change in quantity 
demanded so that the total price area is constant. In the case 
of elasticities greater than unity, an increase in price causes a 
lesser price area while a decreased price leads to a greater outlay. 
The reverse situation holds when the elasticities are less than 
unity. These relations hold in the case of negative supply 
* Most economists reason as though all demand curves must be nega- 
tively inclined, but this is not necessarily so.