THE NUMORIX GUIDE
How to use the Price Elasticity Calculator
Last reviewed September 14, 2026
What this calculator does
The engine uses the midpoint (arc) method: percent quantity change = (Q2 - Q1) / ((Q1 + Q2) / 2) x 100 and percent price change = (P2 - P1) / ((P1 + P2) / 2) x 100.
Formula and method
The engine uses the midpoint (arc) method: percent quantity change = (Q2 - Q1) / ((Q1 + Q2) / 2) x 100 and percent price change = (P2 - P1) / ((P1 + P2) / 2) x 100. Elasticity is the absolute value of their ratio, while revenue change is P2 x Q2 - P1 x Q1.
Variables and inputs
Enter price 1, price 2, quantity 1, and quantity 2. Prices are currency per unit and quantities are units sold. The form has no product, time period, or unit selector, so both observations must be comparable.
Worked example
With price rising from $10 to $12 and quantity falling from 1,000 to 800, midpoint quantity change is -22.22% and midpoint price change is 18.18%. Elasticity is about 1.22, so the engine labels demand elastic; revenue falls from $10,000 to $9,600, a change of -$400.
How to interpret the result
An elasticity above 1 means the percentage quantity response is larger than the percentage price change under this two-point comparison. The engine reports magnitude only, so the separate revenue result is needed to see the direction of the sales-dollar change.
Common mistakes to avoid
Use matching price and quantity observations and let the formula use midpoint denominators. Do not enter percentage changes in the raw fields. Keep a price increase's negative quantity response distinct from the absolute elasticity value.
Assumptions and limitations
Two observations cannot establish causation or isolate a demand curve from advertising, income, seasonality, competition, and supply changes. Zero or malformed prices and quantities are not rejected by the pure engine and can create undefined or misleading ratios.