The Price Elasticity of Demand calculator computes the ratio of the percent change in quantity demanded and the percent change in price.
INSTRUCTIONS: Enter the following:
Price Elasticity of Demand (PED): The calculator returns the ratio as a real number (e.g. 4). However, this can be automatically converted to a percent (e.g. 400%) via the pull-down menu.
PED = CD / CP
Note: A more reliable way to compute price elasticity of demand is via the. The is:
`PED = ((Q_2 - Q_1) ÷ (Q_2 + Q_1)"/"2) / ((P_2 - P_1) ÷ (P_2 + P_1)"/"2) = ("Percent Change in Quantity")/("Percent Change in Price")`