Price Elasticity of Demand
A measure of the responsiveness of the quantity demanded of a good to a change in its price. It is calculated as:
Investopedia Commentary
If a small change in price is accompanied by a large change in quantity demanded, the product is said to be elastic (or responsive to price changes). The opposite also applies, a product is inelastic if a large change in price is accompanied by a small amount of change in demand.
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See also: Economics, Pricing Power