The price elasticity of demand is the ratio of the percent change in the quantity demanded to the percent change in the price as one moves along the demand curve.

Question

Quizplus · Accepted Answer

The price elasticity of demand formula is:

Price elasticity of demand = Percent change in quantity demanded / Percent change in price

As one moves along the demand curve, the quantity demanded and price will change. Therefore, the price elasticity of demand is calculated by dividing the percent change in quantity demanded by the percent change in price.

The Price Elasticity of Demand Is the Ratio of the Percent