Elasticity Calculator

Calculate price elasticity of demand and supply. Free online economics elasticity calculator.

The Elasticity Calculator computes price elasticity of demand or supply using the percentage change method. Elasticity measures how responsive quantity demanded or supplied is to price changes. Enter price and quantity data to determine whether demand is elastic, inelastic, or unit elastic—crucial for pricing decisions and economic analysis.

Common use cases

  • Pricing strategy decisions
  • Economic policy analysis
  • Market research interpretation
  • Business revenue optimization
  • Academic economics studies

How to use

  1. Enter initial price and quantity
  2. Enter new price and quantity
  3. Click calculate for elasticity
  4. View percentage changes
  5. Interpret elasticity value

FAQ

How is elasticity calculated?

E = (% change in quantity) / (% change in price). Midpoint formula: [(Q₂-Q₁)/((Q₂+Q₁)/2)] / [(P₂-P₁)/((P₂+P₁)/2)].

What do elasticity values mean?

|E| > 1: elastic (responsive). |E| < 1: inelastic. |E| = 1: unit elastic.

Why is elasticity usually negative for demand?

Higher prices lead to lower quantity demanded (inverse relationship). We often use absolute value.

How does elasticity affect revenue?

Elastic: price increase decreases revenue. Inelastic: price increase increases revenue.