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Pricing Elasticity Calculator

Estimate price elasticity of demand, compare revenue before and after a price move, and classify the response as elastic, inelastic, or near unit elastic.

Last updated: 2026-03-25

Pricing elasticity calculator

Enter your values

Measure how demand responded to a price move and whether the revenue outcome actually improved.

All required fields must be filled in.

Elasticity

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Enter the old and new price plus demand to estimate elasticity and revenue impact.

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Example calculations

Tap an example to prefill the calculator with sample values.

Price increase with demand drop

$20 to $24 while units fall from 1,000 to 820

A classic elasticity check where the business wants to know whether a higher price actually improves revenue.

Result: Demand is slightly elastic, so the higher price reduces modeled revenue instead of lifting it.

Inelastic essentials case

Moderate price lift with a smaller unit loss

Useful for categories where customers are slower to change buying behavior after a price move.

Result: When demand is inelastic, revenue can still rise even after units soften.

Discounting test

Cheaper price with stronger demand response

A downside test for promotions that might lift unit volume more than enough to offset the lower price.

Result: Elastic categories can justify price cuts only if the unit response is strong enough.

How the elasticity estimate works

The calculator uses the midpoint elasticity formula: percentage demand change divided by percentage price change, with both percentages measured against the average of the old and new values.

It also compares revenue before and after the price move so you can see whether the demand response actually helped or hurt top-line performance instead of stopping at the ratio alone.

Pricing elasticity FAQs

How midpoint elasticity and revenue impact work together in pricing decisions.

Why use the midpoint method for elasticity?

The midpoint method treats the old and new values symmetrically, which makes elasticity more stable than calculating percentage change from only the starting point.

What does elastic versus inelastic mean?

Elastic demand means quantity changes more than price does in relative terms. Inelastic demand means quantity moves less than price does, so revenue can hold up better after a price change.

Can elasticity ever look positive?

In standard demand curves it is usually negative because price and quantity move in opposite directions. The calculator highlights absolute elasticity for classification but still preserves the signed demand response in the details.

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