Price Elasticity of Demand Calculator

Calculate how changes in price affect demand and revenue

Input Values

Initial Price

Initial Quantity

Final Price

Final Quantity

Revenue Analysis

Initial Revenue: $0.00

Final Revenue: $0.00

            Revenue Change:
            
              $0.00
              (0.00%)

Results

Price Elasticity of Demand: -

Type of Elasticity: -

Calculation Breakdown

Enter values and click Calculate to see the breakdown.

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Price Elasticity of Demand Calculator

The Price Elasticity of Demand Calculator helps you determine how changes in price affect the demand for a product or service. Using the midpoint formula, this tool provides a more accurate calculation of elasticity by considering the average of initial and final values, minimizing distortions in percentage changes.

Price elasticity is essential for businesses, economists, and students to assess the sensitivity of consumers to price changes and to understand revenue implications.

Features

Accurate Elasticity Calculation using the midpoint formula
Automatic Revenue Analysis: See how revenue changes with price adjustments
Instant Result Classification: Get the type of elasticity (elastic, inelastic, unitary)
Detailed Calculation Breakdown for transparency and learning
User-friendly Interface: Simple inputs and clear outputs
Supports negative and positive changes in price and quantity

Use Cases

Retailers testing the impact of price discounts on sales
Economists analyzing demand sensitivity for market forecasting
Students and Teachers learning elasticity through hands-on examples
Marketing Teams understanding consumer price sensitivity
Policy Makers evaluating how taxes or subsidies may impact consumption

How to Use

Enter the Initial Price and Initial Quantity
Enter the Final Price and Final Quantity
Click “Calculate”
See the Elasticity, Type, Revenue Impact, and Calculation Breakdown
Use “Clear” to reset inputs

Example Calculation

Input:

Initial Price = $10
Final Price = $12
Initial Quantity = 100
Final Quantity = 80

Midpoint Elasticity:

$\frac{(80 – 100)}{(80 + 100)/2} \div \frac{(12 – 10)}{(12 + 10)/2}$ $\frac{-20}{90} \div \frac{2}{11} = -0.222 \div 0.182 = -1.22$

Result:

Price Elasticity of Demand = -1.22
Type = Elastic
Revenue dropped from $1000 to $960 → Revenue Decreased

Additional Elasticity Classifications

Beyond “Elastic”, “Inelastic”, and “Unitary”, you can optionally add:

Elasticity Range	Description	Business Strategy
E = 0	Perfectly Inelastic	Demand doesn’t change at all (e.g., life-saving drug)
0 < E < 1	Relatively Inelastic	Revenue increases with price ↑
E = 1	Unitary Elastic	Revenue remains unchanged
E > 1	Relatively Elastic	Lowering price increases total revenue
E = ∞	Perfectly Elastic	Consumers buy only at one price, else demand = 0