Price Elasticity Calculator
Enter old and new price and quantity to calculate price elasticity of demand and see if demand is elastic or inelastic.
Use the Price Elasticity Calculator
Price & Quantity Inputs
Price Elasticity of Demand (PED)
midpoint method
Change Breakdown
% Change in Price
% Change in Quantity
Old Revenue
New Revenue
Revenue Impact
Elasticity Reference
|PED| > 1
Elastic — quantity is sensitive to price; lower price raises revenue
|PED| = 1
Unit elastic — revenue unchanged by price change
|PED| < 1
Inelastic — quantity barely changes; raise price to raise revenue
|PED| = 0
Perfectly inelastic — demand fixed regardless of price
|PED| = ∞
Perfectly elastic — any price increase drops demand to zero
Summary
Price elasticity of demand (PED) measures how sensitive demand for a product is to a change in its price. A PED greater than 1 (in absolute value) means demand is elastic — buyers respond strongly to price changes. A PED less than 1 means demand is inelastic — quantity demanded barely changes when the price moves. This calculator uses the midpoint method for accuracy when percentage changes are large.
How it works
- Enter the original price and the new (changed) price.
- Enter the original quantity demanded and the new quantity demanded.
- The calculator applies the midpoint formula: PED = (ΔQ / Q_avg) / (ΔP / P_avg).
- The result is interpreted as elastic, inelastic, unit elastic, perfectly elastic, or perfectly inelastic.
- A revenue impact note shows whether total revenue will rise, fall, or stay the same after the price change.
Use cases
- Decide whether to raise or lower prices to maximize revenue.
- Evaluate demand sensitivity before launching a sale or discount.
- Compare elasticity across product lines to prioritize pricing strategy.
- Estimate how price changes will affect unit sales volume.
- Teach or study microeconomics pricing concepts interactively.
Frequently Asked Questions
Last updated: 2026-06-11 · Reviewed by Nham Vu