Price Elasticity of Demand Calculator

Enter price and quantity demanded, before and after, to calculate price elasticity of demand.

How to Use the Price Elasticity of Demand Calculator

Enter price and quantity demanded, both before and after a change — PED, its magnitude, and an elastic/inelastic classification are calculated from those four fields.

% Change in Quantity = (Q₂ − Q₁) ÷ ((Q₂ + Q₁) ÷ 2) × 100
% Change in Price = (P₂ − P₁) ÷ ((P₂ + P₁) ÷ 2) × 100
PED = % Change in Quantity ÷ % Change in Price

PED usually comes out negative, since price and quantity demanded typically move in opposite directions — raise the price, quantity bought falls. That's expected, not an error, which is why magnitude (the absolute value) is shown as its own line: it's the number that actually determines the classification, since "elastic" and "inelastic" are about size, not direction.

A magnitude above 1 means demand is elastic — quantity responds more than proportionally to the price change, the kind of good where a small price hike sends a noticeable share of buyers elsewhere. Below 1 is inelastic — demand barely budges, common with necessities that don't have easy substitutes. Right around 1 (within about 0.05) counts as unit elastic, where the percentage swings in price and quantity roughly cancel out.

The midpoint method used here avoids a quirk of the simpler percentage formula, where measuring a price rise from $10 to $12 gives a different percentage than measuring the identical fall from $12 back to $10. Dividing by the midpoint of the two values instead keeps the result the same either direction.