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Perfectly elastic supply

Refers to goods that have a price elasticity of supply value equal to infinity. This essentially means that any amount of a good will be supplied at the prevailing price, but nothing is supplied below this prevailing price. 

This is shown in the diagram below:

perfectly elastic supply diagram

So in this case if the price falls to P2 (even with a small price fall) the quantity supplied by the firm will instantly drop to zero. This is normally a theoretical application of PES to supply curves.

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