Glossary · Micro · Elasticity

Midpoint formula

A way to compute percentage changes that gives the same elasticity whether the price goes up or down: divide the change by the average of the start and end values rather than the starting value. $%Δ Q = \frac{Q _{2} - Q _{1}}{( Q _{1} + Q _{2} ) /2}$ .

Also called: arc elasticity

Taught in: Elastic vs Inelastic — and How to Calculate

Related terms

Price elasticity of demand (PED)

More from elasticity

Cross-price elasticity of demand (XED)Determinants of PED Determinants of PES Elastic demand Income elasticity of demand (YED)Inelastic demand Luxury good Perfectly elastic demand

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