This is the formula for the Price Elasticity of Demand. It measures how much the quantity of good demand changes for a given change in price. On the top is the percent change in quantity demanded. On the bottom is the percent change in price. Price elasticity of demand formula.png These are the details of the Price Elasticity of Demand you must know: The larger the price elasticity of demand the bigger change in quantity produced by a given change in price. The larger the price elasticity the less steep the demand curve. When the ED is greater than one, demand is called Elastic. When the ED is less than one, i.e. a fraction, demand is called Inelastic. When demand is elastic there is a large change in quantity demanded for a given change in price. When demand is inelastic there is a small change in quantity demanded for a given change in price. There are two ways to compute the price elasticity, the Endpoint Method and the Midpoint Method. The Endpoint Method computes percent change compared to the starting value, e.g. if price rises from $1 to $2 the percent change in price is computed as a percent of